IN  MEMORJAM 


JESSICA  PEIXOTTO 
1864-1941 


THE  LIMITS  OF  SOCIALISM 


THE  MACMILLAN  COMPANY 

HKW  YORK  •   BOSTON  •   CHICAGO  •   DALLAS 
ATLANTA  •   SAN  FRANCISCO 

MACMILLAN  &  CO.,  LIMITED 

LONDON  '   BOMBAY  •   CALCUTTA 
MELBOURNE 

THE  MACMILLAN  CO.  OF  CANADA,  Lm 

TORONTO 


THE 
LIMITS  OF  SOCIALISM 


BY 

O.  FRED  BOUCKE 

Professor  of  Economics  at  Pennsylvania 
State  College 


gotfe 

THE  MACMILLAN  COMPANY 
1920 

All  rights  reserved 


I 

COPYRIGHT,  1920, 
BT  THE  MACMILLAN  COMPANY 


Set  up  and  elcctrotyped.    Published  April,  1920. 

IN  MEMORIAM 


PREFACE 

At  the  present  time  the  general  reader  will,  the  author 
believes,  be  interested  in  some  of  the  following  questions 
which  socialism  has  sought  to  answer  in  its  own  peculiar 
way.  First,  to  what  extent  can  the  income  of  the  average 
man  be  raised  under  socialism,  as  contrasted  with  the  pres- 
ent individualistic  regime?  Second,  if  any  marked  change 
in  national  income  is  to  be  expected  from  socialism,  in 
what  direction  will  it  most  naturally  occur,  and  what  are 
the  limits  set  to  this  endeavor?  Third,  is  it  true  that  so- 
cialism can  establish  a  democracy  in  the  political  sense  such 
as  individualism  has  not  as  yet  pretended  to  have  realized? 
Fourth,  is  Marxian  economics  an  indispensable  basis  to 
the  program  mapped  out  by  socialists,  or  is  the  refutation 
of  such  doctrine,  as  hitherto  submitted  by  professional 
economists,  a  relatively  unimportant  step  which  in  no  wise 
invalidates  the  general  outlook  of  socialists?  Fifth,  if 
socialism  is  a  theory  of  prosperity,  what  is  the  scientific 
basis  for  it,  and,  more  particularly,  what  data  has  present 
day  science  to  offer  in  support  of  the  thesis  expressed  or 
implied  by  socialism,  that  a  rational  method  for  socio- 
economic  reform  exists?  Sixth,  what  are  the  ultimate 
questions  which  socialism  has  attempted  to  answer,  or 
must  feel  obliged  to  discuss  hereafter,  in  order  to  find  a 
logical  groundwork  for  its  demands? 

These  and  some  other  outstanding  topics  have  been 
given  consideration  in  the  following  pages,  and  it  is  hoped 
that  in  them  will  be  found  a  review,  from  partly  new 
standpoints,  of  what  is  most  important  in  socialistic  plat- 

M141411 


PREFACE 

forms.  The  fourth  and  fifth  chapters  contain  founda- 
tions for  all  later  ones.  On  them  the  treatment  of  the 
whole  subject  largely  rests.  However,  it  is  hoped  that  the 
summary  which  opens  the  last  chapter  will  furnish  a  con- 
venient guide  to  some  of  the  main  points  advanced,  and  in 
this  way  make  clearer  the  idea  of  limits  in  socialism,  within 
which  socialists  hand  in  hand  with  social  scientists  may 
continue  their  studies,  but  beyond  which  progress  is  less 
certain  and  more  open  to  the  sort  of  criticism  which  up 
to  date  has  injured  the  socialist  cause. 

State  College,  Pa. 


TABLE  OF  CONTENTS 

PART  I 
THE  LIMITS  IN  THEORY 

CHAPTER  ONE  PAGE 

THE  PROBLEM 1-10 

CHAPTER  TWO 
KARL  MARX  AND  THE  ECONOMISTS 11—43 

CHAPTER  THREE 
THE  ECONOMIC  INTERPRETATION  OF  HISTORY       .      .        44-57 

CHAPTER  FOUR 

THE  ECONOMIC  INTERPRETATION  OF  HISTORY  (CON- 
TINUED)             58-108 

CHAPTER  FIVE 
JUSTICE         109-125 

PART  II 
THE  LIMITS  IN  PRACTICE 

CHAPTER  SIX 
THE  LIMITS  IN  PRODUCTION 126-159 

CHAPTER  SEVEN 
THE  LIMITS  IN  DISTRIBUTION  .  ,    160-189 


CONTENTS 

CHAPTER  EIGHT  PAGE 

THE  LIMITS  IN  CONSUMPTION 190-210 

CHAPTER  NINE 
THE  LIMITS  IN  GOVERNMENT 211-237 

CHAPTER  TEN 
A  PETITION ...  .   238-256 


LIST  OF  TABLES 

TABLE  ONE  PAGES 

A  Comparison  of  Marxian  with  Ricardian  and 
Marginal  Economics 26—7 

TABLE  Two 

Age  Distribution  in  the  Population  of  Different 
Countries  in  1910 133 

TABLE  THREE 

Possible  Changes  in  the  Labor  Supply  of  the 
United  States  for  the  Year  1910,  According  to 
Socialistic  Standards 135-6 

TABLE  FOUR 

Industries  with  Small-Scale  Production,  United 
States,  1910 142 

TABLE  FIVE 

The  Distribution  of  Incomes  in  the  United  States 

in   1910 147 

TABLE  Six 

American  Manufactures  in  1914  Which  Were  Con- 
sumed Chiefly  by  People  Earning  Over  $1200  a 
Year 151 

TABLE  SEVEN 

Number  of  Gainfully  Occupied  in  the  United 
States  in  1910,  to  be  Reduced  or  Eliminated  Under 
Socialism  ,  ,  153-4 


THE  LIMITS  OF  SOCIALISM 


CHAPTER  I 
THE  PROBLEM 

§  i.  General  Statement  of  the  Problem. —  Social  sci- 
ence has  to  do  with  social  processes.  It  studies  the 
facts  of  social  life  and  seeks  to  discover  whatever  prin- 
ciples of  general  validity  and  permanent  operation  may 
underlie  them.  The  sociologist  and  economist  notably 
are  interested  in  this  side  of  the  subject.  Each  studies 
the  phenomena  and  looks  for  laws  with  a  possible  view 
to  application.  The  basic  sciences  for  them  are  biology 
and  psychology.  After  they  have  laid  down  the  funda- 
mentals obtaining  in  social  life  the  statesman  may  try  to 
make  use  of  them  for  his  own  purposes.  Politics  is  then 
the  science  dealing  with  the  application  of  principles 
formulated  by  sociology  and  economics. 

This  is  one  way  of  stating  the  sociological  problem 
in  general.  A  second  is  the  common  sense  view  which 
simply  asks:  Are  there  any  social  evils?  Is  there  any- 
thing to  correct  in  the  life  of  individuals  or  nations?  If 
so,  how  may  it  be  done?  As  regards  the  evils,  are  they 
inherent  in  life  or  are  they  eradicable?  Are  they  of  per- 
sonal making  or  should  we  look  for  their  explanation  in 
certain  objective  conditions  over  which  the  individual  has 
no  control?  In  so  far  as  evils  are  removable,  shall  we 
rely  upon  one  major  remedy  relative  to  which  all  others 
are  merely  auxiliary,  or  is  the  cure  to  be  effected  by  call- 
ing to  aid  many  forces  for  betterment,  no  one  of  them 

1 


2  THE  LIMITS  OF  SOCIALISM 

sufficient  by  itself,  but  their  joint  effect  being  a  regenera- 
tion of  society? 

At  all  times  we  have  these  questions  to  face,  because 
evils  always  have  existed  and  likely  always  will  exist.  If 
the  word  evil  is  rightly  understood,  its  complete  elimina- 
tion will  not  be  expected  by  any  scientist.  There  is  al- 
ways room  for  improvement;  we  shall  never  adjust  our- 
selves to  our  surroundings  perfectly. 

§  2.  The  Socialistic  Platform  in  the  United  States. — 
Socialism  is  a  doctrine  and  a  movement  for  reform  which 
has  seen  some  of  the  deeper  aspects  of  the  problem  and 
tried  to  solve  them  in  a  rather  unique  way,  by  abolishing 
capitalism.  The  core  of  socialism  is  the  abolition  of  pri- 
vate property  in  production  and  distribution,  and  the  sub- 
stitution for  it  of  public  ownership.  The  public  in  gen- 
eral, and  not  particular  individuals,  are  to  own  the  means 
by  which  goods  are  produced  and  exchanged.  This  sub- 
version of  one  regime,  and  the  introduction  of  another 
in  which  the  capitalist  is  superseded  by  the  state  or  by 
the  community,  is  the  central  theme  of  socialists. 

Socialism  however  is  more  than  one  single  thing.  It  is 
not  simply  a  theory,  but  also  a  movement  for  redress  of 
evils.  It  is  preaching  and  practice  in  one.  It  is  the 
enumeration  of  evils,  their  explanation,  and  a  prescrip- 
tion for  betterment.  Socialism  consists  of  an  indict- 
ment, a  theory,  and  a  platform  for  propaganda  and 
eventual  realization.  Socialists  have  a  creed  which  guides 
their  conduct,  and  in  this  respect  they  are  much  stronger 
than  many  other  would-be  reformers.  Scientific  socialism 
is  scientific  because  it  properly  inquired  into  the  Why  of 
affairs  before  proposing  to  get  at  the  How. 

The  socialistic  attitude  may  be  illustrated  from  a  simile 
in  a  charming  book  written  by  Edward  Bellamy.1 
i  Bellamy,  E.,  "Looking  Backward,"  p.  10. 


THE  PROBLEM  3 

Society  there  is  compared  to  a  coach  driven  by  Hunger 
and  dragged  on  a  seemingly  interminable  highway  by  a 
throng  of  toilers.  What  a  hilly  road  it  is !  What 
windings  and  obstacles  ahead.  What  a  wearisome  jour- 
ney for  the  common  folk! 

On  top  of  the  coach  ride  a  few  privileged  ones  who  en- 
joy themselves  to  their  hearts'  content.  They  admire  the 
beauty  of  the  landscape  on  each  side  of  the  road,  and  fill 
their  lungs  with  exhilarating  breezes.  They  do  not  gaze 
too  fondly  upon  the  embarrassment  of  the  team  below,  for 
the  spectacle  of  distress  jars  on  their  delicate  sensibili- 
ties. They  are  willing  of  course  to  dress  the  wounds  of 
those  bruised  by  the  ceaseless  straining  in  harness,  but 
they  wish  to  keep  the  vehicle  moving  at  all  costs,  and  they 
spur  on  the  laggards  with  false  words  of  cheer. 

Yet  they  do  not  always  remain  in  their  seats,  nor  are 
all  those  below  condemned  to  perpetual  toil.  An  exchange 
of  seats  does  take  place  from  time  to  time.  Some  of  the 
throng,  perhaps,  manage  to  slough  off  the  shackles  which 
bind  them,  and  succeed  in  climbing  to  the  top.  They 
then  join  the  crowd  of  joyriders  and  are  received  with 
more  or  less  coolness.  Or  some  of  the  privileged  ones 
suddenly  come  to  the  end  of  their  life's  journey  and  be- 
queath their  rights  to  those  below  waiting  anxiously  for 
the  favor. 

A  seat  on  top  is  what  everybody  wants.  And  yet  no 
one  there  is  really  happy,  for  all  are  trembling  in  ever- 
lasting fear  of  a  disaster.  At  every  turn  of  the  road,  at 
every  blocking  of  the  track,  they  shake  with  trepidation 
lest  the  coach  be  upset  and  a  painful  ending  meet  them 
below.  They  enjoy  their  advantages  such  as  an  unequal 
assignment  of  labors  may  give,  but  they  face  the  future 
pessimistically,  because  their  conscience  smites  them. 

Socialists  have  accepted  the   picture   as   substantially 


4  THE  LIMITS  OF  SOCIALISM 

true  to  life.  They  have  called  attention  to  the  inequali- 
ties in  social  arrangements  and  demanded  a  change  for 
the  better.  They  have  insisted  upon  an  upsetting  of  the 
coach  because  they  see  no  other  way  out  of  the  difficulty. 
The  socialistic  theory  of  progress  has  been  formulated 
to  make  this  clear. 

Scientific  socialism  comprises  four  points  of  theory 
that  formerly  were  considered  essentials  for  its  success 
as  a  political  party  in  action.  It  was  the  first  of  so- 
ciological doctrines  to  preach  that  prosperity  must  be 
measured  by  wealth,  that  all  social  relations  turn  on 
facts  of  wealtlPand  its  production  or  exchange,  that 
evils  are  the  result  of  a  maladjustment  socially  grounded, 
and  that  a  revolution  was  impending  because  of  a  uni- 
versal law  which  no  man  and  no  act  of  legislation  could 
defy.  This  is  in  large  part  the  significance  of  socialism. 
It  taught  us  to  connect  our  moral  ratings  with  the  eco- 
nomic facts  of  life.  It  pointed  out  the  paramount  im- 
portance of  income  for  purposes  of  self  realization.  It 
treated  the  problem  of  misery  objectively,  and  yet  hu- 
manized it  by  holding  man  responsible  rather  than  nature. 
And  finally  it  exemplified  the  might  of  maladjustment  by 
showing  how  private  property  under  different  systems  of 
production  could  have  entirely  different  results  for  the 
masses  of  the  people.  From  this  many  things  followed, 
but  one  of  them  notably  was  the  value  of  sociological 
analysis  and  the  need  of  enlightenment  which  should  rem- 
edy evils  before  a  law  of  evolution  did  so  abruptly. 

Marxian  economics  and  Marx's  interpretation  of  his- 
tory have  been  mainly  associated  with  socialism.  It  has 
been  held  that  the  economics  expounded  by  Marx  in  his 
Capital  was  the  making  or  marring  of  socialism,  and 
that  socialism  loses  its  usefulness,  becomes  a  failure,  if 
certain  contentions  in  the  theory  of  value  or  in  the  eco- 


THE  PROBLEM  5 

nomic  interpretation  of  the  past  could  be  proven  unten- 
able. In  this  spirit  mere  details  have  often  been  magni- 
fied into  decisive  issues,  or  what  were  salient  features  have 
been  made  the  test  by  which  to  settle  once  and  for  all 
the  questions  of  social  reform.  Yet  it  is  significant,  and 
it  should  be  well  noted  by  the  critics  of  early  —  let  us  say 
dogmatic  —  socialism,  that  the  arguments  of  Karl  Marx 
have  been  in  large  part  abandoned  by  his  successors  with- 
out weakening  in  the  least  their  ardor,  or  the  chance  of 
their  achieving  unusual  things.  This  alone  should  have 
disillusioned  those  who  thought  that  the  end  of  the  Marx- 
ian system  meant  the  death-knell  of  the  socialistic  move- 
ment. It  manifestly  could  not  mean  that. 

Since  1890  the  German  socialists  have  said  little  about 
surplus  value  and  much  about  political  rights.  Oppor- 
tunism has  diluted  scientific  socialism,  but  it  has  given 
a  new  lease  of  life  to  the  main  assertion  of  socialists  that 
great  evils  exist,  that  they  are  widespread  and  perceived 
by  the  masses;  and  that  the  socialization  of  capital  will 
alone  relieve  mankind  of  its  social  diseases. 

The  war  has  further  modernized  socialistic  demands, 
besides  putting  practice  in  the  foreground;  and  in  the 
United  States  it  has  widened  the  vision  of  reformers,  so 
that  to-day  American  socialism  is  stronger  theoretically 
and  practically  than  ever. 

The  party  platform  of  1918  2  calls  for  the  federation 
of  all  nations  with  a  view  to  ending  wars.  It  pleads  for 
a  uniform  monetary  system  for  all  the  world,  for  the 
devising  of  machinery  to  adjust  credit  to  international 
needs,  for  the  reduction  of  armaments,  and  for  an  inter- 
national minimum  wage  scale.  Those  things  in  particular 
are  to  be  made  the  concern  of  all  nations  in  an  endeavor 
to  promote  universal  goodwill  and  peace. 

2  Congressional  Platform  of  the  (American)   Socialist  Party,  1918. 


6  THE  LIMITS  OF  SOCIALISM 

In  addition  however  many  other  demands  are  made, 
some  of  them  familiar  and  approved  by  the  founders  of 
socialism,  and  others  of  recent  origin,  the  result  of  con- 
ditions which  Marx  could  not  foresee.  We  have  again, 
for  instance,  the  clarion  call  for  a  nationalization  of  priv- 
ate capital,  without  which  socialists  would  lose  their  most 
distinctive  mission.  Public  utilities  and  basic  industries 
including  mines,  grain  elevators,  stockyards,  and  banks 
are  specifically  enumerated  as  preferential  subjects  for 
socialization. 

Other  items  of  note  are  the  abolition  of  child  labor, 
a  reduction  of  the  working  day  commensurate  with  tech- 
nical progress,  the  official  recognition  of  a  national  mini- 
mum wage,  the  extension  of  the  right  to  strike  and  to 
boycott,  the  appointment  of  shop  committees  with  rep- 
resentation of  labor,  the  introduction  of  free  vocational 
education,  gratuitous  insurance  of  all  workers,  both  rural 
and  urban,  against  accident  and  sickness,  and  the  guar- 
antee of  employment  to  all  who  seek  it. 

These  are  the  main  economic  rights  which  socialism 
to-day  grants  to  the  working  classes,  and  the  acknowl- 
edgment of  which  by  the  state  is  the  goal  socialists  are 
aiming  at.  They  come  first  and  overshadow  certain  po- 
litical reforms  that  are  also  urged,  but  which,  we  may 
be  sure,  will  follow  automatically  once  the  economic  rights 
of  the  citizen  are  put  into  operation. 

§  3.  Leading  Questions  for  Socialism. — The  question 
is:  Are  these  demands  fair?  Do  they  harmonize  with 
socialistic  theory  ?  Or  more  to  the  point,  are  they  agree- 
able to  the  data  of  social  science  which  socialism  has  al- 
ways made  it  a  point  to  consult  in  the  framing  of  political 
and  economic  platforms? 

One  may,  to  begin  with,  put  this  more  concretely  by 
asking  what  socialism  promises  in  case  it  is  given  a  free 


THE  PROBLEM  7 

hand,  and  how  much  of  its  promise  is  realizable.  Grant- 
ing the  socialization  of  capital,  what  can  socialism  do  to 
root  out  evil  and  improve  our  living?  According  to  its 
own  admission  the  facts  of  production,  exchange  and 
control  occupy  a  preeminent  place  in  any  scheme  of 
meliorism.  If  then  the  socialist  is  confident  of  accom- 
plishing by  his  system  what  heretofore  we  have  not 
managed  to  do,  on  what  grounds  does  he  make  his 
promises  ? 

As  to  production,  e.  g.,  can  socialism  produce  so  much 
more  than  individualism?  And  in  what  kinds  of  goods 
is  the  gain  to  come?  As  to  distribution,  what  is  meant 
by  a  new  principle  in  the  pricing  of  goods  and  services? 
In  how  far  may  socialism  ensure  each  man  his  product, 
when  the  competitive  regime  fails  to  do  so?  What  are 
the  limits  in  measurement  of  values  and  services?  What 
is  to  define  for  us  a  need,  according  to  which  family  bud- 
gets will  be  made  out? 

Or  take  the  problem  of  consumption  and  of  control. 
What  will  socialism  mean  by  consumption  that  the  ortho- 
dox economist  has  not  meant  by  it?  To  what  extent  can 
economic  income  regulate  psychic  outgo?  How  far  may 
we  hope  for  race  improvement  by  means  of  socialistic  re- 
forms ?  And  in  what  sense  can  socialism  make  democracy 
real,  when  up  to  date  it  has  been  a  mere  sham,  or  at  best 
a  modest  approximation  to  a  lofty  ideal?  Can  the  people 
be  led  to  direct  themselves  politically?  Is  the  prospect 
of  perpetual  peace  bright  enough,  so  that  our  time  hal- 
lowed traditions  of  nationalism  may  give  way  to  a  more 
generous  view  of  mankind? 

Such  are  immediate  practical  questions  that  the  social- 
istic theory  inspires.  But,  in  the  second  place,  it  prompts 
us  to  meet  squarely  the  far  broader  problem  whether  a 
rationale  of  meliorism  really  exists?  Is  it  possible,  and 


8  THE  LIMITS  OF  SOCIALISM 

why  and  within  what  limits,  to  establish  principles  of  re- 
form which  shall  satisfy  our  craving  for  justice  and  social 
welfare  at  a  given  moment?  Is  reform,  in  other  words, 
a  matter  of  science,  or  of  whim  and  hazard  without  pos- 
sibility of  guidance?  Do  we  feel  wrongs  without  having 
redress  elsewhere  than  in  our  personal  adjustments,  or  is 
there  a  way  for  governing  people  so  that  the  welfare  of 
the  largest  number  becomes  feasible  and  normal? 

This  larger  phase  of  the  socialistic  movement  forces  us 
to  search  into  the  nature  of  knowledge,  into  the  relation 
of  social  aspects  which  the  founders  of  socialism  so  bluntly 
stated  and  sought  to  demonstrate  to  a  critical  world.  It 
is  ultimately  a  matter  of  psychology  and  sociology,  if  by 
the  latter  term  we  may  designate  the  sum  total  of  investi- 
gations into  social  man;  However,  the  psychological 
data  may  be  divided  into  the  logical  and  the  psychological 
or  biological,  and  the  first  then  asks :  What  is  our 
knowledge,  how  do  we  reason,  and  what  is  the  meaning 
of  laws  and  causation?  And  the  second  then  treats  of 
the  subjective  interpretation  of  the  social  process.  Man 
of  necessity  is  in  the  center  of  things.  The  social  student 
invariably  will  go  wrong  unless  he  considers  all  sociological 
and  economic  data  an  expression  of  living  men  and 
women,  whose  innermost  nature  is  the  key  to  any  prob- 
lem that  may  present  itself. 

An  answer  to  socialism  hence  involves  an  inquiry  into 
the  process  of  learning  by  which  stimuli  become  response 
and  thoughts  are  converted  into  actions  of  enduring 
value.  It  is  for  the  critic  of,  or  sympathizer  with,  social- 
istic teachings  to  picture  the  relation  between  economic 
and  non-economic  conditions  as  an  individual  experience. 
Only  in  this  manner  can  the  Marxian  interpretation  be 
rectified  in  the  modern  scientific  spirit.  Only  by  this 
route  shall  we  succeed  in  tracing  the  real  connection  be- 


THE  PROBLEM  9 

tween  historical  events  which  to  some  seem  not  at  all  re- 
lated, and  to  others  are  almost  identical.  If  socialists 
dwelled  on  the  causative  force  of  methods  of  production, 
"wereTEey  wrong  or  right?  Was  the  relation  stated  cor- 
rectly, or  is  civilization  an  organic  whole  whose  parts 
the  historian  may  not  separate  on  any  excuse? 

The  wider  treatment  of  the  question  of  meliorism  leads 
to  a  conception  of  progress  and  prosperity  not  altogether 
opposed  to  the  notions  held  by  early  socialists.  It  must 
be  part  of  the  would-be  reformer's  education  to  define 
prosperity,  since  Marxian  philosophy  is  so  incisive  on 
that  point.  It  is  necessary  to  appreciate  its  view  of 
misery  as  an  integral  part  of  an  outlook  developed  not 
by  economics,  but  by  metaphysics.  It  is  inevitable  in- 
deed that  a  contemplation  of  socialistic  ideals  and  prom- 
ises suggests  an  answer  to  the  query:  What  is  the  ulti- 
mate good,  what  is  justice,  and  what  is  the  bearing  of 
science  on  norms  of  life  that  under  individualism  as  well 
as  under  socialism  are  reflected  in  acts  of  the  legislature? 

Socialism,  since  it  is  a  theory  of  prosperity,  implies  all 
these  questions,  and  more.  It  compels  us  to  take  a  long 
view  of  things,  not  a  near  at  hand  view  individualistically 
trumped  up.  Socialism  is  stern  and  bold.  It  boasts  a 
noble  intellectual  lineage,  and  will  not  be  put  off  or 
downed  by  flippant  banter.  Complacency  cannot  undo 
the  ills  that  are  known  to  exist,  and  an  appeal  to  national 
traditions  will  deceive  none  except  the  thoughtless  ones. 
Socialism  is  neither  a  chimera  nor  a  crime,  though  by  a 
few  it  has  been  considered  both. 

The  need  for  reform  seems  universallv  conceded.  But 
whether  it  is  or  not,  the  reality  of  the  larger  problem 
no  one  can  deny.  It  is  worth  while  to  know  whether 
social  evils  have  causes  that  we  can  specifically  unearth 
and  offset  by  remedial  measures.  It  is  important  to  de- 


10  THE  LIMITS  OF  SOCIALISM 

cide  whether  politics  is  more  than  a  game  among  fight- 
ing cocks.  It  does  pique  the  curiosity  of  many  good 
folk  to  see  illegalities  and  absurd  criminality  flourishing 
in  this  age  of  enlightenment.  They  involuntarily  ask: 
Is  it  unavoidable,  or  may  we  right  things  by  using  our 
wits? 

The  world  to-day  is  in  ferment.  The  war  has  set 
people's  teeth  on  edge,  and  the  post-war  effects  are  not 
calculated  to  soothe  their  feelings  on  sundry  matters. 
The  terrible,  the  unbelievable,  the  overwhelming  fact  re- 
mains that  many  millions  had  to  die  innocently  in  a 
stupendous  struggle  that  the  achievements  of  the  nine- 
teenth century  should  have  made  impossible.  Whatever 
we  may  think  of  the  war  just  concluded,  of  its  causes 
and  instigators,  of  its  political  consequences  or  costs  in 
material  and  men,  the  one  great  question  is  now  before  us. 
We  must  know  whether  the  social  process  logically  in- 
volves such  disasters,,  or  whether  the  safety  and  welfare 
of  the  masses  may  be  procured  by  rational  means  at  the 
disposal  of  government,  supposing  social  science  continues 
its  labors. 

Socialism  has  many  times  replied  to  our  questions.  It 
has  placed  the  blame  on  a  certain  form  of  economic  or- 
ganization and  pledged  itself  to  deliver  us  from  all  evil  if 
we  please  to  listen  to  its  sermon.  Social  scientists  can  do 
no  better  than  to  think  of  socialists  as  students  who  de- 
sire to  substitute  sense  for  sentiment  in  reforming  man. 
Whether  they  have  struck  the  right  path,  whether  social- 
ism alone  will  do,  whether  science  can  espouse  a  collectiv- 
istic  program  favoring  some  of  the  demands  voiced  by 
socialists,  these^are  questions  that  at  the  present  moment 
confront  us.  ifljie  ultimate  place  of  science  in  social  re- 
form cannot  be  determined  just  now,  hiTt_it.s  )->pa.ringr  on 
socialism  is  self  evident. 


CHAPTER  II 
KARL  MARX  AND  THE  ECONOMISTS 

§  i.  Marx  as  an  Eclectic —  Marx's  Kapital  is  consid- 
ered an  offshoot  of  English  classic  economics,  whose  chief 
exponents  are  Smith,  Ricardo,  Senior,  and  J.  S.  Mill. 
The  connection  between  especially  Ricardo  and  Marx  is 
so  obvious  that  it  seems  hardly  necessary  to  trace  out 
other  lines  of  descent.  Yet  it  is  by  no  means  true  that 
the  individualistic  scheme  of  economics  as  it  prevailed  at 
the  beginning  of  the  nineteenth  century  was  logically  es- 
sential to  Kapital.  Rather,  if  one  excepts  the  labor 
doctrine  of  value,  there  is  scarcely  any  point  of  prime 
importance  in  Ricardo's  Principles  that  reappears  in 
the  German  work.  The  Bible  of  socialism  uses  English 
<economics  mainly  to  refute  or  recast  it,  not  to  build  with 
it  a  theory  tor  lighting  capitalism.  That  was  surely 
quite  out  of  the  question. 

One  may  explain  this  difference  in  another  way  by 
noting  Marx's  essentials  of  character,  for  plainly  he  was 
an  iconoclast  by  inborn  temperament  who  saw  everywhere 
idols  and  images  where  others  lingered  reverently,  and 
whose  one  mission  seemed  to  be  to  dethrone  the  false 
gods.  Marx  seldom  was  satisfied  with  what  he  saw  about 
him.  He  was  an  idealist  in  spite  of  his  crass  materialistic 
sv>stem  of  sociological  thoughi.  To  him  it  was  painful 
to  see  people  practice  quite  the  opposite  of  what  they 
preached,  to  hear  them  expound  theories  that  nowhere 
squared  with  the  facts,  while  attempting  to  hide  their  real 
sentiments  under  a  mask  of  scholarly  impartiality.  He 

11 


12  THE  LIMITS  OF  SOCIALISM 

sought  to  go  beneath  the  surface  of  things  and  see  what 
was  really  at  stake,  but  in  so  doing  he  usually  encount- 
ered truths  that  rankled  because  those  most  obligated  to 
honor  them  proved  their  worst  enemies. 

Marx  was  a  man  of  great  acumen  and  incredible  capa- 
city for  work.  He  could  read  hundreds  of  books  within 
a  short  time  and  digest  most  of  what  was  significant  in 
them.  He  would  listen  to  many  men  but  ultimately  go 
his  own  way.  He  borrowed  without  plagiarizing,  and  he 
returned  with  interest  the  principal  which  he  openly  made 
use  of.  Whatever  passed  through  the  alembic  of  his 
mind  came  out  as  a  product  distinctly  his  own.  He  took 
pieces  here  and  there,  but  never  all.  Thus  from  Hegel 
he  took  the  dialectic,  but  inverted  his  order  of  syllogisms. 
He  rejoiced  in  Bentham's  positivism,  but  scoffed  at  his 
individualistic  norm  of  utilitarianism.  Of  Proudhon  he 
had,  with  respect  to  some  of  his  preachings,  a  high 
opinion,  but  see  how  he  ranted  at  What  Is  Property! 
Feuerbach  gave  him  inspiration  and  definite  ideas  as  to 
the  meaning  of  the  dialectic  process,  but  for  all  that  he 
turned  away  from  the  Essence  of  Christianity.  The 
naturalistic  philosophy  excited  his  admiration  in  so  far  as 
it  combated  transcendentalism,  but  beyond  that  he  had 
as  little  use  for  it  as  Hume  or  Blackstone.  In  all  in- 
stances he  listened  attentively  at  first,  but  before  long 
found  flaws  that  invalidated  most  of  what  to  others 
seemed  valuable. 

Thus  it  was  that  in  spite  of  the  remarkable  stage  of 
perfection  which  the  economic  science  had  reached  in 
Marx's  days,  little  of  it  is  constructively  incorporated 
in  the  Critique  of  1859.  The  physiocrats  had  written 
their  ponderous  tomes,  Smith  and  Ricardo  had  estab- 
lished firmly  the  principles  of  competitive  economics,  the 
reaction  against  Manchestrianism  had  yielded  some 


KARL  MARX  AND  THE  ECONOMISTS       13 

notable  results  both  among  the  French  and  the  English, 
and  in  Germany  the  Historical  School  was  beginning  to 
develop  a  philosophy  of  methods.  Yet  none  of  it  furn- 
ishes foundations  for  Karl  Marx.  Instead  he  takes  a  bit 
here  and  a  bit  there.  He  nibbles  and  absorbs  a  detail, 
or  plows  diligently  over  a  vast  field  and  then  claims  no 
fruits  whatsoever. 

The  naturalistic  view  he  could  not  entertain  seriously 
because  it  meant  statics,  and  he  saw  in  the  social  process 
everywhere  motion  and  conflict.  The  utilitarian  norms 
were  repugnant  to  him  because  they  smacked  of  senti- 
mentalism,  or  of  professions  of  faith  that  had  nothing 
to  do  with  stern  reality.  Hi£  one  hobby  was  the  majesty 
of  logic.  The  logic  of  events  overawed  him,  if  anything 
ever  did.  He  saw  regularity  and  necessity  where  others 
looked  for  willed  plans  subjectively  valuated.  He  had  no 
patience  with  the  slogan  which  would  change  the  world 
by  giving  it  an  emotional  gruelling.  People,  he  argued, 
should  not  thus  be  fed  and  broken  in. 

As  for  the  movement  fostered  by  Hildebrandt  and 
Knies,  he  considered  it  a  children's  play  because  it  worked 
with  nationalistic  premises,  its  chief  aim  being  the 
economic  development  of  Germany.  Marx  detested  such 
an  outlook.  The  world  to  him  seemed  too  large  to  be 
bounded  by  race  prejudices,  and  on  the  other  hand  he 
could  not  approve  of  a  school  which  catered  more  to 
nationalism  at  any  cost  than  to  internationalism  on  behalf 
of  helpless  masses.  So,  while  taking  some  note  of 
Roscher  and  his  colleagues,  he  bantered  with  them 
lightly,  content  to  pass  their  notions  over  with  a  sar- 
castic remark  at  opportune  moments,  while  immersing 
himself  deeply  in  the  radical  literature  of  Thompson, 
Hodgskin,  Bray,  and  Gray.  What  these  men  had  penned 
in  their  admiration  for  the  French  revolutionary  spirit 


14  THE  LIMITS  OF  SOCIALISM 

he  thought  over  carefully,  with  consequences  known  to 
students  of  socialism.  But  even  their  suggestions  did 
not  enslave  him.  He  was  impressed,  it  appears,  with 
their  collectivistic  treatment  of  a  problem  which  the  dis- 
ciples of  Ricardo  so  despised,  but  he  went  decidedly 
farther,  besides  bringing  in  thoughts  no  mere  economist 
would  have  tried  to  master. 

And  so,  in  a  most  serious  sense,  also  with  his  use  of 
Ricardian  tenets.  He  read  and  digested  thoroughly  what 
this  banker  had  said,  but  in  the  end  he  disagreed  with  him 
on  most  important  points.  Much  he  openly  rejected  and 
criticized  as  utter  nonsense.  The  rest  he  put  to  such 
novel  uses  that  Ricardo  would  probably  not  have  recog- 
nized his  contributions  in  "  Das  Kapital."  Living  amidst 
substantially  like  environments  their  teachings  yet  go  far 
apart.  What  Marx  saw  in  his  long  stay  in  London  did 
not  give  him  the  convictions  voiced  so  modestly  in 
Ricardo's  Principles.  There  were  similarities  between  the 
two  that  might  have  augured  well  for  a  correspondence 
of  views,  but  there  existed  differences,  no  less,  that  in  the 
end  made  them  strangers.  Their  premises  were  not  alto- 
gether the  same,  and  for  this  reason  they  emphasized  dif- 
ferent facts  in  the  world  about  them. 

To  follow  this  thought  of  likeness  and  unlikeness  a  little 
farther  —  for  it  is  rather  interesting  —  Ricardo  might 
very  well  be  called  an  optimist,  complacently  active,  who 
thought  the  world  the  best  possible,  considering  the  laws 
of  nature,  and  looked  after  his  business  on  Exchange. 
Marx  was  a  pessimist  who  could  see  nothing  good  in  the 
world  that  treated  the  laboring  classes  so  shabbily.  But 
on  the  other  hand  he  looked  forward  to  a  change  brought 
about  by  a  law  of  evolution  of  universal  validity,  while 
Ricardo  for  all  his  serene  temperament  was  the  stout  de- 
fender of  a  law  of  diminishing  returns  which  condemned  the 


KARL  MARX  AND  THE  ECONOMISTS       15 

masses  forever  to  a  hand-to-mouth  living.  This  was  cer- 
tainly a  gloomy  outlook.  No  wonder  men  spoke  of  the 
"  dismal  science  "  of  economics. 

Both  Ricardo  and  Marx  were  Jews  converted  to 
Christianity,  but  neither  professed  to  have  understood  all 
of  the  adopted  creed.  Both  were  men  of  outstanding 
personality  and  mind,  men  who  could  think  in  abstract 
terms  and  pack  a  wealth  of  heterogeneous  facts  into  a  few 
concepts.  Because  they  towered  so  far  above  the  general 
run  of  people  they  had  little  confidence  in  its  rantings 
and  judgments.  They  did  not  think  the  average  man 
capable  of  sustained  mental  labors.  They  despised  the 
sentimentalities  of  the  mob,  however  sympathetic  they 
were  toward  their  hardships  which  they  witnessed  with 
sorrow  and  tried  sincerely  to  ease.  Both  were  generous 
and  modest,  unostentatious  and  averse  to  publicity. 
Both  disliked  false  show,  and  especially  pseudo  sentiments 
which  they  sometimes  detected  where  no  one  else  could. 
Marx  derided  the  moralism  of  the  Benthamites,  but  in  his 
own  home  he  was  the  most  exemplary  of  husbands  and 
fathers,  punctilious  to  a  fault,  and  as  conventional  in  mat- 
ters of  morality  as  he  was  a  free  lance  in  theorizing. 
Like  Ricardo  he  was  a  formalist,  a  stickler  for  niceties  in 
reasoning,  but  the  most  convivial  of  friends.  Like 
Ricardo  he  was  a  leader  among  men,  a  leader  in  thought, 
a  prophet  who  foresaw  the  future.  Like  Ricardo  he 
worked  indef atigably  on  behalf  of  truth ;  only  while 
Ricardo  supported  the  government  Marx  labored  to  sub- 
vert it.  Marx  was  only  a  few  years  old  when  Ricardo 
died.  Had  they  been  contemporaries  acquainted  with  each 
other's  work,  it  would  seem  that  they  should  have  gotten 
along  very  well  together,  even  if  they  parted  company  as 
philosophers. 

§  2.  Ricardian    Economics. —  Ricardo    in   his   "  Prin- 


16  THE  LIMITS  OF  SOCIALISM 

ciples  of  Political  Economy  "  modified  at  important  points 
the  Smithian  tradition.  He  called  attention  to  many  in- 
consistencies in  his  predecessor's  statement,  but  he  agreed 
with  him  in  one  all  important  respect,  namely  he  accepted 
the  institution  of  private  property  as  an  indispensable 
part  of  his  economic  environment.  Adam  Smith  had  not 
questioned  this  either.  He  had  thought  it  sufficiently 
justified  by  the  facts  of  human  nature  which  he  studied 
at  leisure  long  before  he  wrote  his  Inquiry.  In  stating 
his  Theory  of  the  Moral  Sentiments  he  had  dwelt  long  on 
the  innate  goodness  of  man.  He  was  greatly  impressed 
with  the  reality  of  an  altruistic  instinct  in  men,  which 
prompted  them  to  do  right  —  even  if  at  times  they  fell 
from  grace.  To  Smith  the  selfish  and  the  social  senti- 
ments were  pretty  well  balanced.  There  was  no  fear  that 
society  would  go  to  ruin  as  long  as  each  was  left  to  his 
own  devices  as  producer  and  consumer.  Discretion,  he 
thought,  would  win  the  day.  But  as  against  the  slight 
risks  of  self-assertion  he  placed  the  menace  of  tyrannical 
government.  Only  if  men  are  permitted  to  enjoy  the 
fruit  of  their  labor  will  they  strive  to  please  others  and  to 
progress.  However  unfortunate  the  disappearance  of 
communism  —  and  he  hints  now  and  then  at  the  burdens 
of  entail  and  primogeniture  —  private  capitalism  had  its 
virtues.  It  was  folly  to  study  wealth  relations  on  any 
other  basis. 

Ricardo  was  satisfied  with  this  view,  and  so  it  was 
natural  that  his  definitions  of  value  and  capital  should  be 
the  competitive  concepts  which  economists  have  learned  to 
respect.  The  determination  of  price  is  left  to  supply  and 
demand,  but  the  value  of  a  good  in  the  long  run  is  the 
amount  of  labor  involved  in  its  production.  Labor  costs 
measure  exchange  value.  This  is  the  rule.  The  excep- 
tions are  monopoly,  as  for  instance  in  the  ownership  of 


KARL  MARX  AND  THE  ECONOMISTS       17 

non-reproducible  articles  —  artworks,  old  vintage,  etc. — 
and  the  effect  of  durable  machinery  which  would  vary  ac- 
cording to  its  nature  and  use.  Capital  as  well  as  land  are 
genuine  producers.  They  are  agents  essential  to  the  cre- 
ation of  values  like  labor  itself.  Consequently  these  fac- 
tors are  entitled  to  a  share  in  the  national  output. 
Whatever  the  income  is,  that  must  be  divided  among  the 
several  agents  so  that  production  may  continue.  From 
the  competitive  standpoint,  furthermore,  productivity  is 
a  rate  of  production  per  unit  of  cost  in  labor  and  material 
spent,  though  the  materials  embody  past  labor.  It  is 
therefore  with  values  that  Ricardo  deals  mainly,  and  not 
with  concrete  stuffs  or  with  service  as  such.  The  aim  of 
the  agents  is  maximum  output  of  values,  not  of  physical 
things. 

The  physical  aspect  becomes  important  in  only  one  re- 
spect, namely  when  the  ratio  of  food  supply  to  the  popu- 
lation is  considered ;  but  here  its  importance  is  so  engross- 
ing that  virtually  the  whole  distributive  scheme  is  deter- 
mined by  it.  For  ever  since  the  Malthusian  doctrine 
found  acceptance  among  economists  as  a  law  explaining 
wars  and  disease  it  also  furnished  the  clue  to  the  puzzles 
of  distribution.  It  was  now  perfectly  evident  that  people 
had  little  to  eat  chiefly  because  they  would  marry  and  rear 
children.  This  alone  kept  them  at  starvation's  door. 
The  sex  impulses  being  so  much  more  dominant  than  any 
other  appetite  men  must  work  harder  each  generation  to 
procure  a  minimum  food  supply,  regardless  of  what  bene- 
fits might  accrue  to  them  from  technical  improvements  in 
another  field.  The  law  of  diminishing  returns  in  agricul- 
ture, after  a  certain  point  of  maximum  yield  relative  to 
the  effort  had  been  passed,  punished  the  thoughtless 
masses  and  proved  a  veritable  goldmine  to  the  proprietors 
of  the  one  indispensable  means  of  production,  to  wit  land. 


18  THE  LIMITS  OF  SOCIALISM 

The  landlord  profited  by  the  stinginess  of  nature.  He 
pocketed  the  difference  between  the  return  on  the  worst 
land  under  cultivation  and  the  yield  of  his  own  superior 
land.  Against  the  rapacious  landlord,  therefore,  must 
be  pitted  the  enterpriser  and  the  wage  earner:  the  former 
because  competition  tended  to  reduce  his  profits  to  a  mini- 
mum scarcely  better  than  a  decent  livelihood,  and  the 
latter  because  in  spite  of  all  inventions  he  could  not  im- 
prove his  daily  board.  He  was  bound  to  live  frugally, 
so  the  owner  of  the  natural  resources  might  live  in  splen- 
dor. The  outlook  was  a  discouraging  one,  but  what 
could  be  done  about  it  ?  It  seemed,  nothing.  Our  only 
hope  could  be  a  further  diversification  of  products,  and 
perhaps  in  the  very  distant  future  a  restraint  of  the  sex- 
passions,  so  that  the  masses  might  have  somewhat  more 
meat  and  wheat  to  consume.  But  of  general  affluence 
there  could  be  no  question. 

Ricardo  does  not  differentiate  clearly  between  the  shares 
going  to  capital  and  those  of  enterprise,  but  he  informs 
us  that  both  will  gradually  shrink,  while  labor,  being  al- 
ready at  its  lowest,  will  hold  its  own.  To  try  to  improve 
the  wage  earner's  lot  would  be  folly,  for  laws  of  nature 
militate  against  such  a  plan.  "  Wages,  like  other  con- 
tracts, should  be  left  to  the  fair  and  free  competition  of 
the  market,  and  should  never  be  controlled  by  the  inter- 
ference of  the  legislature."  l  Such  is  the  verdict  handed 
down  from  the  court  of  classic  economy. 

§  3-  Marxian  Economist —  But  to  Marx  all  this  was 
cant,  or  else  nothing  but  shameful  ignorance.  He  retorts 
in  a  manner  the  classic  economists  never  approved  of. 
Namely  he  refuses  to  lay  social  evils  at  the  door  of  the 
individual  laborer,  and  instead  holds  the  capitalist  to  be 
the  malfeasant.  He  begins  by  denying  what  Ricardo 
i  Ricardo,  D.,  "  Principles  of  Political  Economy,"  ch.  5. 


KARL  MARX  AND  THE  ECONOMISTS       19 

took  for  granted,  and  ends  by  asserting  what  to  Ricardo 
would  have  been  incomprehensible.  In  other  words,  he 
starts  with  the  question:  What  does  private  capitalism 
lead  to  that  socialized  capital  would  not  permit?  And  he 
suggests  the  answer  by  opening  his  monumental  work  with 
a  discussion  of  foe  exchange  process  which  makes  prices 
out  of  utility,  and  profit  out  of  labor.^ 

There  is  some  evidence  to  show  that  Marx  was  influ- 
enced by  the  critics  of  the  Ricardian  system  who  wrote  in 
the  first  third  of  the  nineteenth  century.  W.  Thompson, 
for  instance,  published  his  "  Inquiry  into  the  Principles  of 
the  Distribution  of  Wealth  "  in  1824.  Like  others  on  the 
continent  he  had  learned  from  the  French  Revolution 
and  continued  the  work  carried  on  by  the  naturalists  who 
harped  on  the  rights  of  man.  But  in  England  liberalism 
naturally  took  jm.  ^cpnomic  turn.  Thompson" thus  fol- 
lowed  the  mechanistic  concepts  of  the  French  encyclo- 
pedists chiefly  for  the  purpose  of  illustrating  the  nobility 
of  labor.  A  common  element  was  to  be  found  in  all  kinds 
of  occupation,  no  matter  how  intellectual  it  might  be  in 
fact  or  in  appearance.  He  writes :  "  What  is  thought 
but  motion  produced  and  felt  in  the  brain  ? " 2  and 
thereby  challenges  the  opinion  that  different  sorts  of 
work  are  incomparable.  To  Thompson  and  to  Hodgskin, 
his  colleague,  labor  is  at  bottom  only  one  thing.  It  is 
expenditure  of  energy  and  therefore  measurable  for  pur- 
poses of  distribution. 

It  is  not  unlikely  that  Marx  obtained  some  of  his  ideas 
from  this  group  of  writers.  But,  if  so,  it  is  certain  that 

2  Thompson,  W.,  "  Inquiry  into  the  Principles  of  the  Distribution 
of  Wealth,  Preliminary  Observations,"  1824.  See  also  Bray,  J., 
"  Labor's  Wrongs  and  Labor's  Remedies,  1839,"  from  which  Marx 
quotes  at  length  in  his  "Misery  of  Philosophy,"  written  in  1846. 
A  large  part  of  the  Marxian  viewpoint  is  also  to  be  found  in  Gray, 
J.,  "  The  Social  System,  1831." 


20  THE  LIMITS  OF  SOCIALISM 

he  went  much  farther  in  his  use  of  the  physical  notion  of 
labor,  for  he  deliberately  lumps  all  classes  of  labor  and 
arrives  at  a  unit  of  "  socially  necessary  labor  "  by  sum- 
mation and  division.  He  tells  us  in  the  first  pages  of  his 
book  that  "  skilled  Jabor  counts  only  as  simple  labor 
intensified."  3  That  is  to  say,  instead  of  two  measures  of 
a  product  the  skilled  laborer  turns  out  three  or  four  in 
the  same  time ;  but  otherwise  his  contribution  is  on  a  par 
with  that  of  the  jack-of -all-trades.  He  furthermore  de- 
fines for  us  the  term  "  socially  necessary  "  labor.  He 
urges  that  it  comprises  three  elements  always,  viz.,  strictly 
human  effort,  valuable  effort,  and  outlay  of  energy.4  All 
labor,  he  insists,  is  of  man.  Labor  is  the  source  of  all 
wealth.  Nothing  is  produced,  but  the  hand  or  mind  of 
man  has  exerted  energy  which  roughly  is  measurable  and 
may  be  imputed  to  joint  producers.  But  he  granted  that 
unless  turned  to  productive  uses  an  expenditure  of  phys- 
ical force  (Arbeitskraft)  would  not  yield  values. 

Production  being  thus  made  possible  by  labor  solely  it 
followed  that  machinery  was  not  a  productive  agent,  and 
hence  that  capitalists  had  no  just  claim  to  the  social  divi- 
dend. Capital,  Marx  argued,  was  but  solidified  labor. 
It  was  labor  in  concrete  form;  labor  that  had  crystal- 
lized as  salts  might  crystallize  from  a  solution.  Capital 
was  mere  congealed  labor,  and  hence  the  owner  of  capi- 
tal had  no  right  to  its  products. 

Marx  devoted  endless  pages  to  showing  that  capital 
was  but  a  by-product  of  competition  and  of  the  contract 
system  of  production  which  the  champions  of  Laissez  Faire 
had  popularized  by  their  ingenious  treatises.  To  him 
capital  was  nothing  if  not  the  fruit  of  laws  whose  very  ex- 

s  Marx,   K.,  "  Capital,"  ,as   published  by   Ch.   Kerr  &  Co.,  vol.   1, 
*  Ibidem, 'en.  T,  plfesim. 


KARL  MARX  AND  THE  ECONOMISTS       21 

istence  should  be  justified  first,  but  which  the  facts  of 
production  could  not  justify.  "  Capital,"  he  exclaimed, 
"  is  dead  labor  that  vampire-like  fattens  on  the  blood  of 
living  labor."  Capital  was  no  more  than  legalized  rob- 
bery. It  was  a  wolf  in  sheepskin,  a  license  .to  steal,  an 
interloper  in  honest  business,  a  letter  patent  for  mulcting 
the  real  producer  of  his  wealth,  and  a  system  of  pillage 
whose  ramifications  threatened  to  undermine  the  social 
order.  What  Ricar^o  had  attributed^tothe  blind  work- 
ings of  a  n]^rjness  laaL^of  rmt^fpg/J^ffl.-rv  i»nrmpffprl  ex- 
clusively with,  a  faulty  economic  regime,^  albeit  one  which 
could  be  overthrownand  replacecMSy  a  more  logical  one, 
if  the  masses  ~ 

In  "^Capital"  the  anomalous  position  of  private  prop- 
erty is  pictured  less  forcefully  than  in  earlier  essays,  but 
it  is  still  emphasized  that  private  property  was  once  in 
its  place,  and  has  lost  its  rights  only  because  the  methods 
and  means  of  production  were  changed  in  principle  during 
the  century  immediately  preceding  the  Marxian  analysis. 
Between  1750  and  1850,  it  is  pointed  out,  the  self-suffi- 
ciency of  the  laborer  has  given  way  to  a  minute  division 
of  labor,  so  that  trade  is  everything  and  the  handicraft  of 
the  individual  little  or  nothing.  While  one  man  could 
turn  out  a  finished  article,  or  as  long  as  the  joint  authors 
of  a  product  jointly  owned  the  tools  they  worked  with, 
private  ownership  was  natural  and  harmless.  But  it 
ceased  to  be  innocuous  when  mechanical  power  and  intri- 
cate machinery  did  away  with  the  need  of  muscle  and 
simple  tools.5  To  put  the  ownership  of  the  means  of  pro- 
duction now  in  the  hands  of  a  few  men  meant  to 
enslave  the  worker  who  had  nothing  to  offer  but  labor- 
power. 

5  See,  e.  g.,  ibidem,  vol.  I,  pp.  88-91,  and  wellknown  passage  in 
"Holy  Family." 


22  THE  LIMITS  OF  SOCIALISM 

Henceforth  exploitation  began  and  enriched  the  non- 
worker  under  the  protection  of  contract  and  law. 

Theoretically  Marx  had  only  contempt  for  the  Mal- 
thusian  formula.  He  could  not  tolerate  its  implications 
for  fear  of  losing  the  main  plank  in  his  economic  plat- 
form. Yet  it  appears  ever  and  anon  that  the  subsistence 
wage  of  the  proletariat  had  no  other  solid  foundation 
than  its  preference  for  a  large  family,  or  at  least  for  sex 
indulgence,  to  a  table  freighted  with  good  things  to  eat. 
It  should,  then,  be  understood  that  Ricardo  after  all  led 
Marx  into  his  central  position,  even  though  from  a  desire 
for  consistency  this  was  loudly  denied.  Marx  in  fact 
consents  to  write :  "  The  wages  are  regulated  on  the  one 
hand  by  a  natural  law;  their  minimum  is  determined  by 
the  physical  minimum  required  by  the  laborer  for  the 
conservation  of  his  labor-power  and  for  its  reproduc- 
tion — ;  "  but  "  historically  developed  social  needs  "  6  help 
to  fix  this  minimum.  So  far  the  author  of  "  Capital,"  to 
which  may  be  added  Engels'  stress  of  the  opposite  view- 
point that  "  the  underconsumption  of  the  masses  is  a  nec- 
essary condition  of  all  forms  of  society  in  which  robbers 
and  robbed  exist,  and  therefore  of  the  capitalist  system."  7 
The  difficulty  of  harmonizing  these  two  contentions  must 
have  been  apparent  to  Marx,  but  it  is  never  candidly 
acknowledged. 

But  if  labor  is  the  sole  fount  of  wealth  land  is  not  gen- 
erically  different  from  capital.  This  is  the  point  brought 
out  by  Marx,  as  a  result  of  which  he  again  takes  issue  with 
Ricardo.  For  he  now  grants  to  land  a  share  for  the  same 
reason  that  he  also  favors  the  capitalist.  Rent,  too,  is 
part  of  the  loot  legalized  by  the  private  property  regime. 
Rent  is  plunder  precisely  in  the  same  sense  that  profits 

5  Marx,  K.,  ibidem,  vol.  3,  p.  1000;  or  vol.  1,  pp.  189-190. 
7  Engels,  F.,  «  Anti-Diihrmg." 


KARL  MARX  AND  THE  ECONOMISTS       23 

were.  Capitalist  and  landlord  were  two  of  a  kind. 
Neither  was  acting  honestly.  However,  unlike  Ricardo 
who  pointed  his  accusing  finger  at  the  landlord,  Marx  was 
chiefly  intent  upon  exposing  the  trickery  of  the  capitalist. 
Industry  had  grown  since  Ricardian  days.  The  city 
worker  was  everywhere  in  evidence.  It  seemed  natural  to 
bring  the  offending  industrialist  to  justice  first,  and  to 
let  the  minor  culprit  go  free  for  a  while.  In  a  sense,  the 
socialists  had  to  admit,  the  landlord  was  the  spoiled  dar- 
ling of  mother  nature,  just  as  the  classic  economists  had 
themselves  believed. 

But  what  of  the  employment  of  capital  and  labor  in  its 
effects  upon  profits,  particularly  upon  the  rate  of  profit? 
Marx  got  into  difficulties,  as  is  well  known,  because  his 
labor  theory  of  value  left  no  room  for  the  productiveness 
of  machinery.  The  employer  raised  his  profits  as  he  in- 
creased the  number  of  laborers  engaged.  This  agreed 
with  Marxian  theories  and  should  have  prevented  the 
movements  of  the  dividend,  that  is  of  profits  which  the 
market  recorded.  Some  critics  of  Marx  have  maintained 
that  by  this  test  alone  the  labor  notion  of  price  fell  down 
completely,  since  facts  contradicted  it  constantly.  Either 
price  and  profits  were  not  solely  dependent  on  labor,  or 
the  Marxian  analysis  failed  to  take  care  of  one  problem 
in  distribution.  The  harm,  however,  was  not  as  great  as 
may  appear.  For  if  Marx  had  insisted  that,  while  labor 
was  the  sole  source  of  value,  it  was  only  one  factor  com- 
bining with  capital  goods  for  purposes  of  production,  he 
would  have  been  safe.  The  varying  ratios  of  capital  and 
labor  in  a  productive  act  need  then  not  have  bothered  him 
so  much.  The  decisive  factor  would  still  have  been  labor, 
though  its  alliance  with  capital  was  a  condition  of  pro- 
ductiveness usually,  if  not  always.  But  for  that  matter 
the  case  was  not  nearly  so  much  of  a  test  for  socialistic 


24  THE  LIMITS  OF  SOCIALISM 

philosophy  as  has  been  affirmed  by  its  most  outspoken  ene- 
mies. The  Marxian  system  is  not  shaken  by  confessions 
of  error  in  pricing  schemes.  Nothing  great  was  at  stake. 
Marx  knew  that  the  rate  of  profits  varied  with  the  volume 
of  capital  used,8  and  remembering  it  he  could  admit  it 
without  renouncing  his  labor  theory  of  value. 

The  Marxian  viewpoint  is  in  other  respects  self-con- 
sistent like  the  Ricardian  which  he  combats.  He  believed 
that  a  rising  share  of  the  national  income  had  to  go  to 
land  and  capital.  This  followed  naturally  from  the  sur- 
plus notion  which  pictured  the  laborer  as  receiving  only 
what  was  necessary  to  reproduce  his  labor  power,  while 
the  excess  of  time  he  worked  yielded  products  stolen  by  the 
owner  of  capital  who  thus  accumulated  huge  sums,  until 
finally  a  catastrophe  would  overtake  him.  But  of  this 
more  in  a  later  chapter. 

It  is  worth  while  to  point  to  the  distinction  between  the 
percentage  of  the  aggregate  social  income  accruing  to 
labor  or  capital,  and  the  rate  of  profits  or  wages.  The 
latter  refers  to  what  the  average  capitalist  or  wage 
earner  gets,  the  former  would  mean  the  share  known  as 
profits  or  wages  distributed  among  all  the  capitalists  or 
workers  respectively.  As  others  had  long  pointed  out: 
According  to  the  Malthusian  principle  the  labor  con- 
tingent increases  and  their  total  food  wages  may  rise,  but 
the  income  of  each  laborer  in  foodstuffs  cannot  rise,  and 
may  shrink.  Similarly  in  the  Marxian  position.  The 
average  laborer  has  no  prospect  of  improving  his  lot, 
though  there  will  be  a  growing  number  of  laborers  claim- 
ing an  absolutely  larger  amount  in  wages.  Only,  Ricardo 

s  "  Die  Profitrate  nimmt  ab  im  Verhaltnis  zur  steigenden  Akkumu- 
lation  des  Kapitals,  und  der  ihr  entsprechenden  steigenden  Produk- 
tivkraft  der  gesellschaftlichen  Arbeit";  in  "Capital,"  vol.  3,  p.  384. 
But  see  also  pp.  193  &  199. 


KARL  MARX  AND  THE  ECONOMISTS       25 

thought  that  owing  to  technical  improvements  the  laborer 
would  benefit  somewhat  in  the  end  by  gaining  on  enter- 
prise, even  if  he  paid  tribute  to  the  landlord.  Marx  could 
not  agree  to  this  concession,  and  drove  his  premises  to 
their  ultimate  conclusion.  Marx  consequently  had  to 
cast  about  for  other  means  to  save  the  masses. 

That  under  such  circumstances  he  could  not  love  the 
competitive  spirit  goes  without  saying;  however,  he  pro- 
fessed to  like  it  because  its  continuance  and  unhampered 
sway  would  precipitate  the  proletarian  revolt.  This  was 
the  nature  of  his  tolerance  toward  Laissez  Faire.  He 
would  vote  for  it  and  for  free  trade  since  it  tended  natur- 
ally to  destroy  individualism.  It  was,  therefore,  a  good 
thing  to  espouse.9  But  Ricardo  preached  Laissez  Faire 
because  he  argued  from  promises  first  laid  down  by  Adam 
Smith,  the  acceptance  of  which  inevitably  led  to  con- 
clusions out  of  accord  with  state  interference. 

As  will  be  seen  from  Table  One  the  two  philosophies 
agree  in  only  eight  out  of  the  eighteen  points  specified. 
The  departures  on  the  part  of  Marx  from  the  classic  sys- 
tem are  more  marked  than  his  agreements  with  it,  and 
the  practical  consequences  are  poles  asunder. 

|  4.  Criticism  of  Marxian  Economics. —  What  is  to 
be  said  in  regard  to  the  position  which  Marx  defended  so 
strenuously  during  his  lifetime  and  which  since  then  has 
often  been  restated  by  his  followers? 

In  the  first  place,  evidently,  the  Marxian  analysis  can 
no  longer  satisfy  us  because  the  facts  go  against  it.  The 
lot  of  the  average  man  has  been  improved  instead  of  going 
from  bad  to  worse  as  Marx  predicted.  He  has  more  to 
spend  and  has  a  greater  variety  of  goods  to  consume  than 
a  few  generations  ago.  The  level  of  living  has  risen  per- 

»  In  a  speech  delivered  on  Jan.  1  1849,  in  Brussels  on  "  Die  Lage 
des  Freihandels." 


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28  THE  LIMITS  OF  SOCIALISM 

ceptibly,  and  the  middle  class,  so  far  from  dying  out,  has 
increased  numerically.  True,  the  bulk  of  the  popula- 
tion even  in  the  most  progressive  countries  is  still  work- 
ing under  contract,  the  capitalist  having  usually  the  upper 
hand  in  the  bargaining,  but  this  has  not  prevented  labor 
from  obtaining  a  goodly  part  of  the  improvements  en- 
joyed by  the  wealthy.  Cycles  of  booms  and  depressions 
have  recurred  as  before,  but  exploitation  has  not  grown  in 
proportion,  as  Marxian  economics  taught.  If  all,  or 
even  the  major  portion,  of  what  labor  produces  above  a 
bare  subsistence  fund,  had  gone  to  capital  the  misery  of 
the  multitude  would  be  infinitely  greater  than  it  is. 

In  the  second  place,  the  theory  of  surplus  value  becomes 
logically  untenable  when  competition  between  laborers, 
due  to  the  complete  mobility  of  labor  which  it  assumes, 
ends.  One  cannot  accept  this  thesis  of  ruthless  exploita- 
tion without  imagining  the  individual  worker  left  entirely 
to  his  own  resources,  deserted  by  his  mates  and  betrayed 
by  a  plutocratic  government.  But  this  sort  of  mobility 
never  existed,  as  even  Adam  Smith  was  anxious  to  admit 
for  all  his  belief  in  individualism.  Human  nature  is  often 
stronger  than  legal  provisions  for  freedom  of  contract 
and  of  residence.  People  become  addicted  to  habits. 
They  develop  a  fondness  for  places  and  memories.  They 
will  not  move,  though  offered  a  higher  wage.  Also,  they 
have  since  the  rise  of  socialism  learned  to  combine.  The 
right  of  association  has  not  been  denied  them.  The  union 
has  done  away  with  the  advantage  that  men  of  means,  and 
particularly  of  the  means  of  production,  used  to  have,  or 
reputedly  had,  in  bargaining  with  labor.  A  new  method 
of  pricing  has  arisen  that  is  a  long  way  removed  from 
the  facts  of  competition  and  mobility  which  the  classics 
pictured. 

In  the  third  place  capital  is  not  solidified  labor,  be- 


KARL  MARX  AND  THE  ECONOMISTS       29 

cause  matter  is  not  altogether  the  same  as  mind.  Motion 
is  not  notion.  True,  we  do  well  in  tracing  mental  phe- 
nomena by  their  physiological  equivalents.  The  plan  of 
the  scientist  to  ascertain  the  nature  of  mental  states  by 
forms  of  behavior  objectively  measurable  is  not  a  con- 
temptible one.  The  physical  correlatives  are  ordinarily 
there  to  be  studied.  They  enable  us  to  determine  the 
routine  of  reactions  in  man,  which  otherwise  might  re- 
main undecipherable.  But  this  does  not  mean  the  identi- 
fication of  quantity  and  quality.  Generic  differences  be- 
tween mind  and  matter  should  be  granted  to  exist  unless 
special  purposes  forbid. 

So,  by  the  same  token,  it  is  an  error  to  call  machines 
mere  material  put  together  by  a  working  hand.  Work  for 
the  economist  is  not  what  it  is  to  the  physicist.  The 
physicist  defines  work  as  the  overcoming  of  resistance 
through  space.  He  is  interested  in  actions  and  reactions. 
He  deals  with  quantities  only.  The  social  student,  on  the 
contrary,  is  primarily  engrossed  in  questions  of  value. 
Values  are  the  subject  matter  particularly  of  economics. 
And  values  originate  in  scarcity,  whatever  amount  of  en- 
ergy is  needed  to  change  the  forms  of  matter. 

Goods  represent  ideas.  They  are  the  embodiment  of 
thoughts  infinitely  rare  at  one  time,  and  made  cheap  only 
in  the  course  of  social  evolution.  All  labor,  to  illustrate 
our  point,  may  be  divided  into  the  repetitive  and  the  in- 
novating kind.  The  former  may  be  quantitatively  meas- 
ured. It  suggests  comparisons.  If,  for  instance,  I 
plow  now  one  acre,  and  the  next  time  two  acres,  using 
the  same  tools  and  methods,  I  have  added'  to  value  and 
may  anticipate  an  increased  return.  But  I  have  created 
nothing  new.  I  get  more  wheat,  but  it  is  of  the  same  sort. 
I  used  more  implements,  but  of  the  same  sort.  Everything 
was  repetition  or  multiplication.  But  suppose  I  breed  a 


30  THE  LIMITS  OF  SOCIALISM 

new  variety  of  wheat,  suppose  I  make  certain  alterations 
in  the  plow-share,  suppose  I  change  my  principle  of  fer- 
tilizing the  soil.  Here  we  have  an  innovation  that  leads 
to  distinct  products:  Perhaps  it  is  a  new  sort  of  wheat, 
or  wheat  in  larger  amounts  for  constant  effort. 

There  is  a  reliable  test  for  invention  or  innovation. 
Namely,  if  with  constant  effort,  thanks  to  changes  in  capi- 
tal or  in  the  use  of  it,  I  procure  a  bigger  return,  then  I 
have  been  an  inventor.  Or,  if  I  create  a  new  article, 
something  not  heretofore  on  the  market,  then  again  I 
have  shown  inventiveness.  All  things  now  familiar  were 
new  once  upon  a  time.  There  is  hardly  anything  on  the 
market  but  it  was  invented  once.  If  an  article  becomes 
cheaper  or  is  improved,  that  change  means  an  innovation 
in  the  economic  sense. 

Considering  these  objective  tests  for  an  innovation  we 
have  an  excellent  way  for  distinguishing  between  things 
and  thoughts.  In  a  printing  press  we  have  a  combination 
of  thoughts  that  may  or  may  not  have  cost  effort-in-time. 
It  is  not  always  easy  to  say  when  or  how  an  idea  origi- 
nated. In  general,  to  be  sure,  ideas  are  the  fruit  of 
much  intellectual  toil.  We  must  have  so  much  school- 
ing and  technical  training,  whether  it's  as  novelists  or  as 
chemists  or  as  mechanics.  There  is  work  back  of  inven- 
tion. But  at  the  moment  a  thought  comes  it  may  not 
involve  a  time-element  of  labor.  Effort-in-time  is  the 
sort  of  effort  spent  in  digging  a  ditch.  We  see  the  mo- 
tions and  may  measure  them  by  the  hands  on  the  dial  of 
a  watch.  So  with  most  repetitive  acts  producing  wealth. 
Yet  this  is  not  so  applicable  to  inspirations  resulting  in 
new  products  or  in  cheapening  methods.  What  shall  we 
say  of  the  inventor  of  rod  and  reel,  of  Arabic  numbers, 
of  the  alphabet,  of  the  steam  engine,  or  of  whatever 


KARL  MARX  AND  THE  ECONOMISTS       31 

innovation  in  science  or  economics  we  may  have  in  mind? 
These  are  the  result  of  immeasurable  labors. 

Ideas  are  rare,  and  therefore  fetch  a  high  price.  It 
was  a  good  principle  for  Marx  to  demand  the  socializa- 
tion of  ideas,  but  a  bad  one  to  put  all  sorts  of  labor  into 
a  single  class.  "  Socially  necessary  labor  "  is  a  concept 
as  inadequate  as  we  know  the  concept  of  averages  to  be. 
Innovations  and  repetitions  should  not  be  put  on  a  level. 
They  are  incomparable.  Capital  goods  are  not  labors 
piled  up  in  a  heap,  to  be  assembled  and  taken  apart  at 
command.  The  funding  of  all  labor  varieties  was  an 
awkward  scheme  for  determining  price,  which  after  all  was 
not  Marx's  main  task. 

Let  us  put  the  matter  in  another  way  by  asking  what 
would  become  of  the  surplus  if  innovation  ever  ceased. 
Marx  declares  that  by  making  the  laborer  work  for  longer 
hours  than  are  needed  to  supply  him  with  the  essentials 
of  life  the  capitalist  reaps  a  rich  harvest.  It  is  said  he 
takes  the  extra  hours'  product  and  uses  it  to  employ  more 
labor  to  continue  his  unfair  practices.  Thus  he  waxes 
rich,  and  labor  is  cheated  of  its  belongings.  One  is 
tempted  to  give  ear  to  the  argument,  were  it  not  for  the 
accumulation  of  the  surplus.  If  at  the  beginning  this  sur- 
plus is  wheat,  what  do  we  use  it  for?  The  answer  can 
not  be  that  it  is  to  employ  more  labor  to  cultivate  more 
land  so  as  to  produce  more  wheat.  For,  in  the  first 
place,  this  is  not  the  record  of  economic  achievements,  and 
in  the  second  place  it  does  not  appeal  to  our  sense  of  pro- 
portions. Ere  long  we  should  have  enormous  stocks  of 
wheat;  but  what  for?  It  is  easy  to  provide  for  a  rainy 
day,  and  it  is  natural  to  hoard  some  things.  But  an 
endless  accumulation  of  one  commodity  does  not  help 
much.  The  end  of  life  is  variation.  The  spice  of  life  is 


32  THE  LIMITS  OF  SOCIALISM 

variety.  The  march  of  progress  is  toward  diversification. 
Ever  new  things,  this  is  the  motto :  not  an  excess  of  some 
one  staple  like  wheat.  A  surplus,  originally  of  foods 
perhaps,  could  be  valuable  only  if  part  of  it  were  used  to 
feed  men,  not  to  till  the  fields  to  produce  wheat,  but  to 
produce  another  kind  of  food  product,  or  more  likely 
something  not  to  eat,  but  to  wear.  And  later  on  each 
year's  surplus  of  a  given  class  of  goods  should  serve  only 
to  dedicate  energy  to  new  endeavors.  An  increase  of 
labor  is  necessary  for  the  diversification  of  products. 
Growth  of  population  is  neither  an  end,  nor  always  an 
incident,  in  economic  progress.  Not  multiplication  of 
men  and  materials,  not  this  primarily,  but  diversification 
of  products  is  the  chief  aim.  A  larger  number  of  goods 
produced  at  less  cost ! 

What  is  the  moral?  This,  that  exploitation  in  itself 
could  not  help  the  captialists  if  they  were  not  assured  of 
new  methods  and  new  products,  that  is  of  ideas,  of  inven- 
tions which  might  have  been  their  own,  or  the  laborer's. 
The  surplus  view  of  Marx  must  either  recognize  classes  of 
work  distinct  in  a  value  analysis,  or  it  preaches  a  silly 
accumulation  of  goods  that  nobody  wants  because  they 
would  soon  exceed  all  possible  needs. 

But,  in  the  fourth  place,  value  itself  is  not  measurable 
by  the  amount  of  labor  spent  in  its  creation.  That  fol- 
lows from  what  has  just  been  said.  But  it  also  is  shown 
by  everyday  experience,  and  besides,  it  was  admitted  by 
Marx.  Marx  indeed  had  two  ways  of  stating  his  atti- 
tude. He  could  say:  Under  competitive  individualism 
value  is  determined  by  something  else  than  labor  cost. 
True,  but  I  disapprove  it.  And  he  could  argue:  Under 
socialism  prices  will  vary  with  costs  as  defined,  that  is 
with  socially  necessary  labor.  The  latter  is  the  only  cor- 
rect pricing  principle.  But  as  we  know,  Marx  did  not 


KARL  MARX  AND  THE  ECONOMISTS       33 

commit  himself  in  that  manner.  Instead  he  pictured 
prices  as  labor  results  quantitatively  measurable  and  com- 
parable, while  insisting  also  upon  a  standard  of  living 
which  according  to  his  surplus  theory  of  value  did  not 
exist  under  capitalism.  That  under  socialism  as  well  as 
on  present  terms  costs  of  labor  cannot  always  fix  values 
appears  at  first  moment,  but  Marx  thought  the  excep- 
tion to  his  rule  inconsequential. 

§  5.  Marginal  Economics. —  The  Marxian  economics 
should  be  taken  seriously  and  hence  criticized  where  mod- 
ern science  urges  it.  But  it  is  easy  to  belittle  the  Marx- 
ian concept  without  remembering  its  great  merits  and  the 
influence  it  has  wielded  over  later  minds.  More  particu- 
larly one  may  make  sport  of  some  Marxian  notions,  for- 
getting that  our  current  economic  viewpoint  does  not 
rise  much  above  them.  The  group  of  economists  who 
stood  out  in  arms  against  the  socialists  also  attacked  the 
historical  movement  in  general,  and  of  course  they  had  in- 
creasingly occasion  to  revise  the  classic  version  to  Smith, 
Senior,  Ricardo,  and  of  the  two  Mills.  The  prevailing 
economics,  though  no  longer  as  homogeneous  as  at  the 
opening  of  this  century,  is  therefore  a  reaction  against 
both  Ricardianism  and  against  historism.  The  hope  of 
deducting  permanent  principles  from  an  exhaustive 
searching  into  economic  history  has  been  pretty  well 
abandoned.  A  number  of  factors  contributed  to  the  de- 
cline of  the  historical  methods,  though  we  may  regard 
J.  S.  Mill's  Logis,  which  appeared  in  1842,  as  a  turning 
point  for  economic  method;  for  Mill's  own  Principles  of 
Economics  show  no  trace  of  a  method  distinctive  of  social 
science,  as  presaged  in  the  Logic.  If  the  acute  J.  S.  Mill 
returned  to  deduction,  what  could  others  expect  from  his- 
torism? The  Austrian  economists  combated  historism 
because  of  their  training  under  philosophers  who  sep- 


34,  THE  LIMITS  OF  SOCIALISM 

arated  rigidly  deduction  from  induction,  and  had  no  con- 
fidence in  Hegelian  prophecies.  Hence  men  like  Menger 
and  Wieser,  Boehm-Bawerk  and  Sax  were  ready  to  re- 
claim the  field  of  investigation,  which  the  Historical 
School,  like  scientific  socialism,  had  declared  barren  and 
unfit  for  use. 

But  in  fact,  the  marginal  approach  was  in  thorough 
agreement  with  the  psychological  movement  of  the  second 
and  third  quarters  of  the  nineteenth  century.  The  trend 
was  distinctly  toward  introspective  analysis  supplemented 
and  corrected  by  exact  measurement  of  reactions  to  ex- 
ternally applied  stimuli.  Psychology  rapidly  established 
itself  as  an  objective  science,  with  the  result  that  the 
facts  of  human  nature  were  definitely  classified  and  char- 
acterized. 

This  way  of  redefining  values  marks  also  the  marginal 
school  of  economists  who,  beginning  with  Gossen,  Walras, 
and  Jevons,  revamped  the  Ricardian  notions  by  shifting 
the  emphasis  from  work  to  wants,  and  from  materials  to 
margins  of  response.  Much  of  the  classic  structure  was 
left  untouched,  but  the  nomenclature  changed  greatly. 

The  marginal  viewpoint  abandoned  the  attempt  of  ex- 
plaining prices  through  expenses  in  time  and  effort.  It 
went  directly  to  the  question  of  wants,  and  by  compar- 
ing their  different  intensities  tried  to  explain  prices.  It 
showed  that  we  care  relatively  the  less  for  a  stock  of 
goods  the  larger  it  is,  and  that  we  constantly  seek  to 
equalize  our  supplies  of  different  kinds  of  commodities. 
Hence  the  marginal  procedure  led  away  from  costs  to 
sacrifice,  and  from  production  of  stuffs  to  creation  of 
values,  no  matter  whether  they  took  palpable  form  or  not. 

Like  the  Ricardian  the  marginal  view  is  static.  It  pic- 
tures a  process  at  rest  in  a  given  moment,  much  as  a  pho- 
tograph reveals  certain  facial  expressions.  The  advan- 


KARL  MARX  AND  THE  ECONOMISTS       35 

tages  of  a  moving  picture  over  a  snapshot  compare  ap- 
proximately with  the  superiorities  of  a  dynamic  over  a 
static  method  of  dissection. 

Like  Ricardo,  the  Marginists,  too,  assume  competition, 
private  property,  and  freedom  of  contract.  It  is  not  for 
them  to  question  the  worth  of  our  social  order.  They 
take  it  as  it  is  and  proceed  to  define  their  terms  accord- 
ingly. Everything  hinges  on  competition  and  on  the  mo- 
bility of  labor  and  capital.  Since,  furthermore,  capital  is 
a  right  under  the  law  it  is  entitled  to  a  share  of  the  na- 
tional product.  But  here  the  Marginists  became  bold  in 
making  out  of  capital  goods  a  bundle  of  property  rights 
rather  than  a  work  of  ideas.  Rights  were  continually 
stressed,  and  social  aspects  subordinated  to  them.  Capi- 
tal, even  if  not  taking  concrete  shape,  they  called  a 
factor  of  production  just  as  truly  as  manual  labor  or  soil 
fertility.  There  existed  consequently  at  least  three  "  fac- 
tors "  of  production,  though  toward  the  end  of  the  century 
enterprise  was  segregated  from  labor  upon  due  recog- 
nition of  its  unique  functions  under  individualism.  Thus 
we  get  really  four  agents  in  production,  all  of  which  had  a 
share  in  the  social  dividend  according  to  some  principle  of 
distribution. 

The  notion  of  cost  was  materially  modified,  for  as 
against  the  classics  the  Marginists  did  not  begin  with 
labor.  They  started  with  desires.  They  asked:  Why  is 
so  much  labor  spent  in  producing  an  article,  and  instead 
of  answering  as  the  older  men  would  have,  that  the  tech- 
nique of  production  could  not  do  it  in  less  time,  they 
pointed  to  the  intensity  of  our  want.  Man,  it  now  ap- 
peared, was  willing  to  give  so  much  labor  to  the  creation 
of  a  certain  commodity  because  compared  with  others  he 
wanted  it  so  much  that  the  labor  did  not  seem  excessive. 
The  need  of  food,  shelter,  and  clothing  comes  first.  Noth- 


36  THE  LIMITS  OF  SOCIALISM 

ing  can  take  precedence  over  it,  and  hence  any  amount  of 
toil  necessary  to  produce  them  will  be  expended.  But  for 
the  remainder  of  our  level  of  living  we  are  governed  by 
different  rates  of  wants,  some  being  intense  enough  to  fol- 
low immediately  after  the  essentials,  and  others  being 
classed  as  luxuries.  The  march  of  progress  is  the  exten- 
sion of  wants  and  the  thinning  of  the  margins  at  which  we 
choose  to  buy  one  article  instead  of  another.  When  we 
have  decided  on  this  matter,  then  the  amount  of  effort  de- 
voted to  the  production  of  an  article  will  be  revealed. 
Costs  are  the  proof  of  valuation  measured  by  our  willing- 
ness to  sacrifice  one  good  for  another.  Time  and  energy, 
materials  and  thought,  are  secondary  facts  in  the  explana- 
tion of  price. 

The  whole  subject  of  cost  versus  want  was  finally 
worked  over  and  the  true  relation  between  the  two  dis- 
closed. It  could  hardly  escape  the  notice  of  observant 
students  that  expenses  as  treated  by  the  marginal  view 
were  valuations  of  the  past,  and  that  therefore  in  a  sense 
all  costs  were  values.  But  by  the  same  ruling  expenses 
could  be  admitted  as  a  certain  objective  way  of  measur- 
ing subjective  aspects,  and  so,  in  stretching  the  static 
outlook  to  cover  decades  at  a  time,  costs  and  wants  be- 
came complementary.  "  In  the  long  run  "  they  could  be 
pictured  as  two  sides  of  one  and  the  same  thing.  The 
reconciliation  seemed  opportune,  and  served  to  give  a  new 
lease  of  life  to  the  individualistic  conception  of  product 
and  price. 

As  shown  in  our  Table,  productivity  according  to  the 
Marginists  is  a  rate  of  return  in  goods  per  outgo  of  other 
goods,  each  good  being  defined  as  a  scarce  transferable 
utility,  and  a  utility  as  anything  satisfying  any  want. 
From  this  followed  the  interesting  development  of  the  con- 
cept of  diminishing  returns  which  no  Ricardian  would 


KARL  MARX  AND  THE  ECONOMISTS       37 

have  understood.  It  was  shown  that  since  production  is 
a  competitive  concept  referring  to  values,  the  costs  of 
production  could  not  fall  merely  in  agriculture.  For  one 
thing,  the  yield  in  concrete  things  did  not  mean  every- 
thing because  economics  reckons  in  values,  in  dollars  and 
cents.  If  the  farmer,  for  instance,  sold  a  smaller  crop 
at  a  larger  aggregate  gain  than  a  larger  crop  in  the 
previous  year,  then  his  rate  of  return  had  risen.  And  in 
the  next  place  it  became  more  and  more  apparent  that  in 
all  fields  of  endeavor  there  is  a  right  and  a  wrong  way 
of  doing  things.  The  terrifying  law  of  diminishing  re- 
turns thus  was  converted  into  the  perfectly  harmless  prin- 
ciple of  a  proportionality  of  factors.  It  was  shown,  as 
everybody  indeed  knew,  that  temperance  is  a  virtue,  that 
a  sense  of  proportions  will  do  wonders,  that  too  much 
of  one  element  in  a  compound  will  spoil  it.  The  marginal 
view  made  land,  labor,  capital  and  enterprise  the  four 
factors  of  production.  Let  them  be  mixed  in  one  way, 
and  maximum  return  results  for  the  business  manager ;  let 
him  violate  the  law  of  proportions  and  he  will  obtain  less 
than  the  maximum.  Space  and  time  also  entered  into  the 
situation,  and  all  in  all  the  purification  of  Ricardian  no- 
tions left  the  economist  little  better  off  than  he  had  been 
before. 

But  the  marginal  definition  of  productivity  helped  in 
one  respect.  Namely  the  rule  of  margins  in  valuation 
was  applied  to  the  services  of  the  agents  in  production, 
the  rate  of  pay  depending  on  the  marginal  product  of 
each  agent.  On  a  short-time  view  the  least  effectively 
employed  unit  of  labor  or  capital  set  the  pace  for  the 
remaining  units.  None  could  get  more  than  the  marginal 
one,  for  the  same  reason  that  the  least  valued  dose  in  a 
stock  of  homogeneous  goods  fixed  the  value  of  the  whole 
stock.  One  had  only  to  multiply  the  number  of  units 


38  THE  LIMITS  OF  SOCIALISM 

in  a  stock  by  the  utility  —  or  value  —  of  the  marginal 
item  to  compute  the  value  of  the  whole  stock.  Incomes 
varied  on  the  same  principle.  On  a  long-time  view  how- 
ever the  better  worker  was  a  blessing  to  the  inferior, 
for  competition  would  sooner  or  later  force  a  distribution 
of  the  additional  product,  the  marginal  man  benefiting 
with  the  rest.  Each  factor  received  his  "  product  "  as 
per  definition.  Profits  were  the  only  exception,  because 
they  tended  toward  a  minimum.  Or  rather,  as  some  an- 
nounced, there  were  no  profits  under  perfect  competition, 
only  a  wage  of  management. 

Consequently  land  and  labor  benefited  most  by  technical 
improvements.  Interest  rates  were  also  subject  to  the 
general  law,  but  meant  less  to  the  practical-minded 
student  of  distribution.  Laborers  would  obtain  a  grow- 
ing share  of  the  national  dividend  because  of  the  effect  of 
invention  on  productivity.  The  landlord  could  not  claim 
it  all,  as  Ricardo  had  apprehended.  The  economic  process 
was  less  cruel  than  the  classics  had  made  it  out  to  be. 
Hence  the  Marginists  favored  frankly  the  competitive 
principle  and  tolerated  interference  only  where  it  was 
proven  absolutely  indispensable.  They  had  shown  that 
each  gets  what  he  deserves  according  to  definitions  of 
utility,  value,  and  capital,  so  no  occasion  arose  for  com- 
plaint. 

A  glance  at  Table  One  informs  us  that  the  marginal 
and  the  Ricardian  viewpoints  are  not  as  far  apart  as 
either  compared  with  the  socialistic.  In  spite  of  im- 
portant revisions  the  Ricardian  doctrine  survived  the  ad- 
vent of  Marginism.  The  modern  orthodox  economic 
standpoint  marks  a  step  in  advance,  but  its  logic  is  the 
old.  The  competitive  principle  colors  everything.  Ab- 
stractions rule  as  before.  Ricardo  like  the  Marginists 
approved  of  the  world  as  he  found  it.  As  the  Table 


KARL  MARX  AND  THE  ECONOMISTS       39 

shows  they  agreed  in  nine  out  of  the  eighteen  points,  while 
Marx  and  the  Marginists  had  only  five  in  common.  Four 
of  the  eighteen  points  were  held  in  common  by  Ricardians, 
Marxians,  and  Marginists,  but  of  course  Marx's  defini- 
tions of  value  are  only  provisional.  He  is  opposed  to  the 
individualistic  norms.  He  uses  them  solely  to  arraign  the 
capitalist.  His  chief  aim  is  the  annihilation  of  what  the 
other  two  groups  wished  to  leave  undisturbed. 

The  question  then  is  not  merely  one  of  logic.  One  will 
ask :  How  much  more  satisfactory  was  the  marginal  view 
than  the  heresies  of  socialism?  Or,  more  to  the  point, 
what  oddities  of  reasoning  appear  in  it  that  orthodox 
economics  is  not  guilty  of,  too? 

|  6.  Criticism  of  Marginal  Economics. — The  Marxian 
like  the  Ricardian  view  emphasizes  labor  as  the  source  of 
values,  and  it  measures  them  by  the  amounts  of  labor 
spent  in  the  creation  of  a  value.  This  is  one  way  of  mak- 
ing values  objective  and  is  naturally  thought  of  first  be- 
cause time  and  effort  are  facts  every  one  is  acquainted 
with.  Marx  saw  no  reason  for  rejecting  the  labor 
standard,  though  he  enlarged  upon  the  concept  by  social- 
izing labor.  He  not  only  proposed  to  attribute  all  values 
in  exchang^  to  the  labor  needed  for  the  production  of 
scarce  utilities,  but  he  furthermore  averaged  different 
rates  of  production.  He  made  three  points :  He  de- 
clared labor  to  be  the  sole  fount  of  all  values ;  he  reduced 
all  kinds  of  effort,  manual  and  mental,  to  a  homogeneous 
stock  (what  he  called  labor  power)  and  he  standardized 
costs  in  labor  by  establishing  an  arithmetical  average  of 
different  amounts  of  labor  applied,  in  terms  of  hours  of 
work,  by  different  individuals  or  groups  to  the  produc- 
tion of  equal  values.  This  latter  procedure  was 
peculiarly  Marxian. 

Now,  the  marginal  procedure  is  different  in  one  sense, 


40  THE  LIMITS  OF  SOCIALISM 

but  much  like  it  in  another,  for  while  it  displaces  labor 
by  valuations,  it  none  the  less  averages  different  valua- 
tions just  as  Marx  averaged  different  productivities 
measured  by  effort-in-time.  According  to  the  marginal 
view  different  want  intensities  of  different  individuals  with 
different  tastes  and  different  incomes,  that  is  purchasing 
powers,  may  be  reduced  to  an  average  which  expresses 
itself  in  the  bidding  of  buyers  and  sellers  in  a  competitive 
market.  It  has  been  pointed  out  by  critics  that  such  is 
not  an  admissible  device,  because  logically  no  such  average 
can  be  proven  to  exist.  Individuals  as  averages  are  a 
piece  of  fiction  anyway.  But  it  deserves  mention  here 
that  the  marginal  economists  made  this  average  a  central 
feature  in  their  price  determination. 

What  is  more,  the  Marxian  assumption  of  a  fairly  con- 
stant labor-power  per  average  individual  has  the  ad- 
vantage of  making  one  cost  do  for  several  sales  at  differ- 
ent times.  But  if  the  Marginists  are  right,  valuations 
fluctuate  constantly  so  that  really  an  article  is  sold  at  a 
valuation  of  the  present  moment  which  in  all  probability 
differs  from  the  valuations  embodied  in  the  article  at  the 
time  it  was  produced.  That  is,  we  must  resort  to  another 
averaging  of  variations  of  want  in  order  to  establish 
some  fixed  relation  between  the  price  of  a  finished  com- 
modity, which  by  the  way  represents  as  many  prices  as 
it  has  constituent  costs,  and  the  productivity-rate  of  re- 
turn. To  the  Marginists  this  relation  is  a  very  definite 
one.  It  is  one  of  identity.  Prices  measure  factorial 
shares.  But  the  averaging  is  as  risky  for  the  pro- 
ductivity-theory of  incomes  as  it  is  inadequate  for  the 
explanation  of  commodity  prices. 

Marx  was  not  so  embarrassed,  for  in  adopting  im- 
plicitly, though  not  expressedly,  the  Malthusian  formula 
he  simplified  distribution  as  Ricardo  had  done.  There 


KARJL  MARX  AND  THE  ECONOMISTS       41 

were  only  three  factors.  One  was  paid  a  subsistence 
wage,  the  other  received  a  supra-marginal  product  from 
the  soil,  and  the  third  took  the  leavings.  Very  simple ! 

The  marginal  standpoint,  however,  led  to  other  predic- 
aments, some  of  them  not  more  amusing  than  impressive. 
For  instance,  according  to  the  concept  of  consumer's  sur- 
plus a  man  saved  the  more  the  less  he  saved.  In  the 
great  majority  of  cases  a  purchase  was  a  saving  because 
the  article  was  worth  more  to  the  buyer  than  he  was 
forced  under  competition  to  pay  for  it.  He  had  all  kinds 
of  units  of  utility  left  after  he  got  his  money's  worth. 
Let  him,  therefore,  spend  more  and  enjoy  more  consumer's 
surplus. 

On  the  other  hand  there  was  the  bugbear  of  alternative 
costs  which  no  entrepreneur  could  escape.  He  was  rarely 
sure  of  having  invested  his  funds  the  best  possible  way. 
Every  advantage  in  employment  of  capital  was  offset,  by 
the  sacrifice  of  investment  elsewhere.  The  option  was  a 
nagging  thought  that  should  figure  in  the  ledger  when 
investment  was  not  the  most  lucrative  possible.  A  farmer 
too  should  reckon  as  costs  for  fodder  the  price  at  which 
he  would  have  had  to  buy  it  hadn't  he  produced  it  himself 
at  a  lower  cost.  And  the  interest  charge  grew  every 
minute,  for  everything  reconvertible  into  pure  capital,  or 
what  once  was  in  the  shape  of  liquid  capital,  ate  up  in- 
terest. All  consumption  goods,  indeed,  might  have  been 
used  as  capital.  Since  they  were  not,  a  loss  could  be 
claimed.  The  individualistic  outlook  permitted  such  cost 
accounting. 

It  also  gave  birth  to  the  famous  paradox  of  value  which 
the  Austrian  economists  first  expounded,  and  which  has 
often  since  served  to  illustrate  the  principle  of  marginal 
utilities.  But  note  what  one  might  flippantly  infer  from 
it :  It  apparently  makes  it  possible  to  destroy  and  create 


4£  THE  LIMITS  OF  SOCIALISM 

capital  in  the  same  act.  If  the  spice-importers,  for  in- 
stance, feared  the  effect  of  large  supplies  on  price  they 
could  save  themselves  by  sinking  a  portion  of  the  cargo 
of  spices.  They  would  sink  the  ships  and  raise  the  prices 
and  probably  aggregate  profits.  Such  is  the  test  of 
monopoly.  They  used  the  cargo  as  part  of  their  working 
capital,  say  of  their  "  circulating "  capital.  They  de- 
stroyed part  of  this  capital  by  casting  spices  overboard. 
But  the  same  act  also  increased  the  value  of  the  residual 
of  spices.  Capital  was  therefore  created  while  it  was 
destroyed. 

Or  notice  the  curiosity  of  the  marginal  capital  defini- 
tion, by  which  one  and  the  same  article  became  alternately 
capital  and  non-capital,  that  is  a  consumption  good. 
The  piano  in  the  baker's  shop  was  capital  while  used  to 
attract  customers.  It  was  part  of  his  earning  assets 
then.  But  if  used  to  entertain  the  same  people  after 
closing  hours  it  became  a  mere  utility.  The  baker's  fam- 
ily listened  to  an  instrument  forming  part  of  his  wages  of 
management ;  the  customers  were  regaled  by  the  employ- 
ment of  capital.  Likewise  cocaine  sold  illicitly  at  a  drug- 
store was  capital,  while  mother's  care  of  her  children  was 
non-productive  labor,  since  it  was  not  offered  for  sale  in 
the  open  market. 

Finally,  it  deserves  mention  that  Marx  was  at  least  con- 
sistent in  his  position  as  ethicist.  He  did  better  than  the 
marginal  group  for  two  reasons.  Namely,  in  the  first 
place  he  did  not  incorporate  moral  topics  in  his  Capital. 
True,  like  his  followers,  he  hinted  plainly  at  a  moral 
issue.  Nobody  could  condemn  private  capital  and  not 
plead  guilty  to  a  charge  of  moralism.  But  Marx  kept 
reform  programs  out  of  his  text.  He  did  not  profess 
to  purge  economics  of  all  ethical  background  and  then 
proceed  to  discuss  at  great  length  many  questions  of  re- 


KARL  MARX  AND  THE  ECONOMISTS       43 

form    and    legislation    such    as    frequently    characterize 
modern  texts  for  school  use. 

In  the  second  place  he  grounded  his  ethics  more  se- 
curely than  the  Marginists  who  were  drilled  in  the  meta- 
physical style  of  moralizing.  If  economics  declines  to 
deal  with  moral  matters,  pretending  that  somebody  else 
has  preempted  that  field,  it  is  guilty  of  a  contradiction 
of  terms.  It  was  socialism  which  first  drove  home  this 
point,  and  familiarized  the  man  of  the  street  with  the 
social  aspects  of  religion  and  ethics.  The  Marxian 
economics  excels  in  that  it  makes  ethics  part  of  social 
science.  It  reduces  all  knowledge  to  experience,  that  of 
"the  moralist  included.  Largely  to  demonstrate  this 
unity  of  thought  and  to  give  reform  movements  a  solid 
basis  the  founders  of  socialism  elaborated  their  concept 
of  history,  thus  preparing  the  way  for  a  view  of  life 
which  must  unify  all  sciences,  however  distinct  their  sub- 
jects. 


CHAPTER  III 

THE  ECONOMIC  INTERPRETATION  OF 
HISTORY 

§  i.  Main  Roots  of  the  Economic  Interpretation  of 
History —  Back  of  Marx's  "  Kapital  "  is  his  economic  in- 
terpretation of  history.  It  is  hardly  possible  to  under- 
stand fully  what  he  meant  to  say  in  his  ponderous  econo- 
mic treatise  without  looking  into  his  other  views  of  a  some- 
what philosophic  nature.  In  regard  to  Marx  we  have 
here  a  situation  that  not  infrequently  is  true  of  other 
great  minds.  We  read  one  of  their  works  and  judge  them 
by  it,  or  at  least  consider  it  something  complete  in  itself, 
forgetting  that,  if  more  was  written,  it  probably  bears 
on  the  very  book  we  are  studying.  For  mind  is  a  unit, 
and  eminent  thinkers  have  given  perspective  to  their 
thought  so  that  what  appears  at  one  place  is  more  or 
less  closely  connected  with  everything  else.  As  we  grow 
we  frequently  change  our  interests  and  write  on  subjects 
originally  not  at  all  in  our  mind.  We  are  driven  from 
one  problem  to  another,  and  so  ultimately  arrive  at  ideas 
that  will  influence  us  the  rest  of  our  life  in  treating  of 
anything,  no  matter  how  far  apart  the  topics.  Thus  it 
is  difficult  to  appreciate  Aristotle's  "  Politics  "  unless  one 
is  familiar  with  his  Metaphysics  and  Ethics.  Thus 
we  may  read  Adam  Smith  on  the  "  Wealth  of  Nations," 
but  fail  to  get  its  total  range  without  some  knowledge 
of  his  "  Theory  of  the  Moral  Sentiments."  Thus  again 
one  is  entitled  to  judge  John  Stuart  Mill  by  his  "  Prin- 
ciples of  Political  Economy."  That  work  should  stand 

44 


INTEPRETATION  OF  HISTORY  45 

or  fall  by  its  contents.  But  how  much  may  easily  be 
missed  if  his  "  Logic  "  has  not  been  given  a  thorough  in- 
spection beforehand! 

And  so  with  Marx  and  Engels  as  founders  of  social- 
ism. Their  criticism  of  the  individualistic  economics  of 
their  day  is  one  thing.  We  may  understand  it  and  draw 
our  conclusions.  But  what  Marx  said  in  his  "  Kapital," 
and  how  he  said  it,  that  is  a  point  to  be  inquired  into  by 
an  independent  study  of  his  earlier  expositions  on  history 
and  Hegelianism.  Huge  growths  have  remote  beginnings. 
Giant  trees  send  out  their  main  roots  deep  into  the  soil, 
and  far  from  the  trunk  feeders  are  still  to  be  found 
whose  function  is  to  give  life  to  the  very  trunk  that  seems 
so  majestically  self-sufficient.  Great  rivers  similarly 
have  their  headwaters  in  perhaps  far  off,  inaccessible 
regions.  In  lofty  heights  the  stream  is  born  that  later 
on  we  find  so  useful  and  overpowering  in  its  grandeur. 
We  do  not  possibly  care  to  explore  the  upper  reaches, 
but  in  this  distant  ancestry  that  gives  rise  to  so  many 
tributaries  we  have  the  explanation  of  the  end  result  it- 
self. 

The  founders  of  socialism  were  no  mean  men.  They 
were  extraordinary  men  who  worked  like  titans  and 
pierced  the  surface  of  things.  They  went  far  for  their 
raw  material  out  of  which  the  socialistic  creed  was  slowly 
built.  They  consulted  many  sources  and  drew  inspiration 
from  thinkers  that  in  their  time  had  no  interest  in  matters 
economic.  Thus  the  intellectual  labors  of  preceding  cen- 
turies bore  fruit  in  the  controversial  writings  of  Marx 
and  Engels,  and  in  their  propaganda  which  since  has 
given  so  much  food  for  thought  to  an  inquiring  age.  One 
must  read  Marx's  articles  in  the  Rheinische  Zeitung,  or 
his  books  against  Proudhon  and  the  Feuerbach  group,  to 
divine  some  of  the  thoughts  basic  to  socialism.  In  his 


46  THE  LIMITS  OF  SOCIALISM 

"  Misery  of  Philosophy  "  and  "  Holy  Family  "  are  ele- 
ments reconstructed  later  in  the  "  Critique  of  Political 
Economy,"  but  utilized  also  in  the  "  Communist  Mani- 
festo," as  well  as  in  the  "  Kapital."     Of  Engels  the  out- 
put is  in  a  sense  not  so  important  because  it  was  for  the 
most  part  written  after  the  economic  interpretation  of 
history  had  been  formulated.     Yet  there  is  much  of  value 
in  the  "  Anti-Diihring  "  and  in  the  "  Essay  on  Feuerbach," 
both  of  which  represent   answers   to   critics   of   scientific 
socialism  as  it  flourished  in  the  last  quarter  of  the  nine- 
teenth century.     Engels  was  the  philosopher,  if  Marx  was 
the  economist.     However,  on  the  one  hand,  Marx  could 
think  philosophically  himself,  though  he  had  done  with  it 
comparatively  early  in  life,  and  on  the  other  hand  Engels 
never  forgot  the  economic  background  whose  disagreeable 
features  had  prompted  him  to  describe  the  condition  of 
the  working  classes  in  England,  as  they  existed  in  the 
second  quarter  of  his   century.     Strictly   speaking  both 
were  incapable  of  the  sort  of  thinking  which  character- 
izes professional  philosophers.     We  do  not  find  any  evi- 
dence that  they   could  follow  Hegel,  e.  g.,   through   the 
maze  of  his  reasoning  which  led  from  "  Logic  "  to  the 
"  Philosophy    of    History."     In    perusing    the    youthful 
works  of  Marx  one  is  struck  with  what  he  didn't  notice 
in  Hegel  rather  than  with  what  he  selected  for  criticism. 
However,  while  he  made  no  pretense  of  fathoming  the  full 
depth  of  metaphysical  problems,  he   took  care   to   seize 
upon  salient  points  that  could  prove  useful  to  his  sociolo- 
gical   outlook.     Hence    the    transcendental    thought    of 
Hegel's  time  is  part  of  scientific  socialism.     Hence  the 
"  Critique    of    Political    Economy "    really    begins    with 
searchings  into  matters  not  now  recognized  as  scientific. 

Whether    the    economic    interpretation    of    history    is 
peculiarly  the  product  of  Marx  and  Engels  is  perhaps 


INTEPRETATION  OF  HISTORY  47 

not  an  important  question.  Those  who  have  delved  some- 
what into  the  genesis  of  that  mighty  concept  will  prob- 
ably concede  to  the  founders  of  socialism  a  large  measure 
of  originality  in  this  respect.  One  may  make  many  ex- 
cursions into  the  relevant  literature  of  those  days  with- 
out meeting  any  such  formula  as  Marx  and  Engels  made 
famous  in  their  "  Manifesto  of  1848."  On  the  whole  it 
seems  fair  to  grant  these  two  men  the  lion  share  of  the 
glory,  and  to  distinguish  generously  between  the  in- 
gredients they  found  at  hand  and  the  product  they  turned 
out  with  them.  There  had  been  materialism  before,  as 
everybody  knows,  but  it  had  not  been  given  a  historical 
application.  There  had  been  economic  interpretations  of 
life  from  the  early  eighteenth  century  on,  but  they  had 
not  been  cloaked  in  a  metaphysical  form.  Historio- 
graphy is  of  ancient  origin,  and  the  notion  of  change 
dates  from  early  Greek  speculation,  but  none  of  it  yielded 
a  Marxian  recipe. 

Again,  the  genetic  standpoint  which  socialism  has  al- 
ways so  ardently  defended  predominated  when  Marx 
was  born.  The  Romantic  movement  was  essentially 
genetic.  One  looked  back  to  forget  the  present,  or  to 
understand  it.  The  great  names  of  that  age  are  known 
as.  well  for  their  views  on  the  social  process  as  for  their 
literary  creations.  But,  once  more,  this  does  not  rob 
Marx  and  Engels  of  their  supreme  merit  as  first  expound- 
ers of  a  materialistic  view  of  history. 

We  might  say :  England  is  the  cradle  of  materialism 
as  the  metaphysician  understands  the  term.  From  there 
it  went  to  France  and  gave  rise  to  a  school  of  thought 
whose  culminating  achievement  is,  in  a  way,  the  Mecha- 
nique  Celeste  of  La  Place.  The  writings  of  Cabanis  and 
Diderot  and  Helvetius  familiarized  people  with  a  ma- 
terialistic valuation  of  life.  The  Baron  d'Holbach  also 


48  THE  LIMITS  OF  SOCIALISM 

contributed  his  mite.  But  this  type  of  materialism  was 
too  mechanical  to  suit  Marx.  Like  Engels  he  relied  more 
upon  Hobbes  and  Locke  than  upon  the  French.  On  the 
other  hand,  the  historical  viewpoint  had  gained  ground 
notably  in  France.  Lamarck  and  Condorcet  were  great 
figures.  And  again,  if  from  England  came  Spencer, 
Darwin,  and  Wallace,  Germany  furnished  a  Herder, 
Humboldt  and  Goethe.  Thus  three  countries  provided  the 
streams  of  thought  that  finally  converged  in  the  socialistic 
movement.  The  biological  aspect  is  English,  the  his- 
torical aspect  first  gained  repute  in  France,  and  the  so- 
ciological or  economic  aspect  was  most  cultivated  in  Ger- 
many. Together  these  nations  developed  the  evolution- 
ary standpoint.  Thanks  to  such  beginnings  the  social- 
ists could  go  ahead.  Hegel  completed  for  Marx  what 
Hobbes  and  Montesquieu  had  begun. 

The  German  materialistic  view  of  Biichner  and  his 
ilk  was  of  no  great  moment  for  Marx.  It  came  some- 
what too  late.  Furthermore,  Marx  wanted  concepts  of 
motion,  not  pronouncements  on  matter  or  space.  The 
achievements  of  chemistry  therefore  did  not  greatly  im- 
press him  aa,  a  student  in  quest  of  a  masterkey  which 
should  open  the  doors  to  social  progress  The  inclination 
for  a  matter  of  fact  view  of  life  existed  early  in  him 
no  less  than  in  Engels,  but  the  impetus  that  moved  him 
onward  till  death  came  from  the  last  of  the  philosophic 
critics !  Hegel  "  made  "  Marx ! 

§  2.  Influence  of  Hegel — It  is  of  no  import  here 
what  Hegel  preached  and  how  he  reacted  upon  the 
"  Critique  of  Pure  Reason."  But  we  must  keep  in  mind 
some  of  the  main  tenets  on  which  he  erected  his  phe- 
nomenal reputation  as  a  metaphysician.  Hegel  was  a 
Platonian  absolutist,  for  one  thing.  In  the  second  place 
his  analysis  of  mind  and  knowledge  led  him  to  the  evolv- 


INTEPRETATION  OF  HISTORY  49 

ing  of  a  concept  of  progress  and  reality  which  is  unique 
in  philosophic  history.  Hegel  not  only  believed  in  a 
reality  transcending  our  sense  experience,  but  he  pictured 
the  processes  of  cognition  as  focussed  upon  a  single  point 
which  marked  the  terminal  of  social  evolution.  To 
Hegel  there  was  a  design  in  history.  The  teleological 
assumption  pervades  all  his  reasoning.  And  with  this  he 
coupled  a  theory  of  State  that  has  astonished  those  who 
dwell  fondly  on  his  Logic.  Hegel,  then,  was  a  theist 
with  monarchical  leanings,  an  exponent  of  idealistic 
values,  and  a  firm  believer  in  the  scientific  character  of 
introspection,  of  what  he  called  the  science  of  all  sciences, 
to  wit  Logic. 

Marx  was  not  enamored  with  this  side  of  the  great 
teacher  at  Berlin.  But  he,  like  Engels,  took  readily  to 
the  other  side  in  Hegelian  teachings  which  later  on  gave 
rise  to  diverse  empirical  movements  in  philosophy. 
Hegel  namely  sought  to  establish  the  identity  of  nature 
and  mind  in  a  manner  not  attempted  by  Kant.  He  bore 
in  mind  more  consistently  than  his  illustrious  predeces- 
sors the  maxim  that  whatever  we  know  is  limited  by  a 
knoweiv  Intelligibility  rests  on  the  intelligence,  and  to 
look  beyond  this  is  a  task  distinct  from  the  first  prin- 
ciples in  logic.  The  first  principles  must  seek  to  explain 
how  we  know  anything  and  how  our  experiences  may 
change  without  losing  continuity.  This  problem  drove 
Hegel  to  his  dialectic  by  which  he  connected  the  object 
with  the  subject.  He  admitted  that  in  reflecting  upon 
our  experiences  we  actually  alter  their  contents,  but  he 
also  pointed  to  the  connecting  link  between  steps  of  cog- 
nition. We  do  get  ahold  of  the  world  about  us,  though 
our  conclusions  change  as  we  shift  viewpoint  and  alter 
premises.  A  contrasting  and  compounding  of  judgments 
ever  takes  place.  By  it  we  secure  new  truths,  but  move 


50  THE  LIMITS  OF  SOCIALISM 

in  pendulum  swings  that  turn  truth  into  falsehood.  We 
go  from  thesis  to  antithesis,  and  hence  to  synthesis.  In 
an  Aufhebung  der  Momente,  as  Hegel  styles  the  process, 
we  add  to  our  knowledge  while  losing  part  of  what  we  have 
felt.  Thus,  logically  viewed,  learning  is  given  movement 
and  direction.  All  things  become  relative.  We  live  in  a 
world  of  contradictions.  What  the  old  logicians  said 
about  laws  of  Identity  and  Excluded  Middle  is  only  under 
certain  reservations  acceptable,  for  a  thing  may  both  be 
and  not  be.  It  may  be  good  and  bad  also.  If  it  is  not,  it 
may  become.  If  it  is,  there  exists  a  raison  d'etre,  but  as 
against  this  we  have  the  prospect  of  decay  and  a  resur- 
rection of  the  old  in  totally  different  forms. 

This  idea  that  all  things  are  relative  to  each  in  the 
sense  that  one  judgment  necessarily  grows  out  of  a  pre- 
ceding one  —  a  thought  Hegel  seems  to  have  distilled  from 
studies  in  Greek  metaphysics  —  this  idea  suited  the  tem- 
perament and  needs  of  Marx  and  Engels.  They  poked 
fun  at  the  absolutistic  phase  of  Hegelian  beliefs,  but  they 
were  deeply  impressed  with  the  weight  of  his  main  con- 
tention. 

When  Hegel  wrote  that  "  the  State  represents  God's 
progress  in  the  world,  it  rests  on  the  power  of  will  taking 
embodiment  in  Reason.  The  State  must  not  be  identified 
with  any  particular  nation,  but  with  God  himself  "  l  - 
Marx  could  not  give  assent.  As  early  as  1843  he  sug- 
gests that  "  the  worst  enemy  of  real  humanism  (that 
is  of  socialism)  in  Germany  is  speculative  idealism." 2 
And  in  the  "  Holy  Family  "  Feuerbach  is  lauded  because 
he  put  Man  in  the  place  of  "  all  this  f  olderol  about  the  in- 

1  Hegel,  "  Enzyklopaedie,"  §258;   §272. 

2  Marx,  K.,  "  Heilige   Familie,"   Preface,  printed   in  Mehring,   F. 
Aus  dem  Literarischen  Nachlass  von  Karl  Marx,  Friedrich  Engels, 
und  Ferdinand  Lassalle,  Volume  I. 


INTEPRETATION  OF  HISTORY  51 

finite  self-consciousness,"3  which  Hegel  made  the  center 
of  his  Logic.  Idealism  was  not  to  the  liking  of  men  who 
were  engrossed  in  economic  studies  and  sought  a  remedy 
for  existing  evils.  More  particularly  Marx  was  not 
satisfied  with  the  type  of  historism  he  read  out  of  the 
Enzyklopaedie.  He  exclaims :  "  Hegel's  historical  con- 
cept is  nothing  but  a  speculative  expression  of  the  Chris- 
tian-Teutonic dogma  of  opposition  between  spirit  and  mat- 
ter, between  God  and  the  world."  4  Such  a  construc- 
tion was  alien,  perhaps,  to  the  mind  of  a  converted  Jew. 

But  all  the  more  glad,  then,  were  the  founders  of  scien- 
tific socialism  when  after  HegePs  death  one  grow)  of 
disciples  turned  radical  and  exploited/the  relativisticl  side 
rather  than  the  idealistic.  Hegel's*  Immense  range  and 
generalizing  applications  admitted  naturally  of  a  great 
variety  of  interpretations.  Those  who  saw  the  force  of 
the  first  and  second  part  of  his  Logic  agreed  to  ignore 
the  third,  thus  getting  rid  of  absolutism.  The  pragmatic 
penchant  in  the  master  was  now  boldly  emphasized  and 
quickly  elaborated  into  a  new  sort  of  humanism.  We 
have  men  who  like  the  brothers  Feuerbach,  like  Bauer 
and  Strauss  transferred  the  logical  relativity  into  a 
sociological  one.  Feuerbach  especially  created  a  stir  with 
his  "  Essence  of  Christianity  "  in  which  religion  was  hu- 
manized and  Christianity  expounded  in  metaphysical 
fashion.  In  the  end  Ludwig  Feuerbach  turned  away 
from  the  materialistic  position  that  at  first  his  readers 
placed  him  in,  but  Marx  kept  what  he  found  good  and 
used  it  for  his  historical  interpretation. 

Hegel  himself  had  furnished  part  of  the  Marxian  view, 
as  was  frankly  admitted.  As  Engels  at  a  later  date  put 
it:  "From  this  (the  Hegelian)  point  of  view  the  history 

a  Ibidem,  Chapter  VI. 
*  Ibidem,  Chapter  V. 


52  THE  LIMITS  OF  SOCIALISM 

of  mankind  no  longer  appeared  as  a  wild  whirl  of  sense- 
less deeds  of  violence,  all  equally  condemnable  at  the  judg- 
ment seat  of  mature  philosophic  reason,  as  deeds  which 
are  best  forgotten,  but  as  the  process  of  evolution  of  man 
himself.  It  was  now  the  task  of  the  intellect  to  follow 
the  gradual  march  of  this  process  through  all  its  devious 
ways,  and  to  trace  out  the  inner  law  running  through  all 
its  apparently  accidental  phenomena." 5  And  when 
Feuerbach  added  to  this  the  humanistic  concept  by  which 
man  was  made  the  center  of  things,  the  sole  judge  and 
jury  of  all  values  in  science  and  philosophy,  then  his- 
torism  assumed  definite  meaning.  The  hedonistic  view  of 
Friedrich  Feuerbach  prevailed  over  the  theism  of  his  elder 
brother.6 

Hegel's  devotion  to  an  Absolute  was  ridiculed.  His 
transcendentalism  evoked  only  the  scorn  of  Marx  who 
concluded  that  the  metaphysical  procedure  turned  things 
upside  down,  making  a  phantom  out  of  what  was  real, 
and  worshipful  truth  out  of  what  man  had  known  and 
never  could  sense.  To  Hegel,  we  read  in  Engels'  "  So- 
cialism Utopian  and  Scientific,"  "  the  thoughts  within  his 
brain  were  not  the  more  or  less  abstract  pictures  of 
actual  things  and  processes,  but  conversely  things  and 
their  evolution  were  only  the  realized  picture  of  the  Idea 
existing  somewhere  from  eternity,  before  the  world  was. 
This  way  of  thinking  turned  everything  upside  down  and 
completely  reversed  the  actual  connection  of  things  in  the 
world  "  7  About  the  same  time  —  this  was  in  1873  — 
Marx  wrote  in  the  Preface  to  the  first  volume  of  his  Kapi- 

5 Engels,  F.,  "Socialism,  Utopian  and  Scientific,"  p.  95.     A  popu- 
lar version  in  English  dress  of  the  same  author's  "  Anti-Diihring." 
•See  especially  Friedrich  Feuerbach,  "Die  Religion  der  Zukunft." 
7  Engels,   F.,  "Socialism,  Utopian   and   Scientific,"   p.   86,   and  in 
"Anti-Diihring,"  p.  30. 


INTEPRETATION  OF  HISTORY  53 

tal :  "  To  Hegel  the  life  process  of  the  human  brain,  i.  e., 
the  process  of  thinking  which,  under  the  name  of  the  Idea 
he  even  transformed  into  an  independent  subject,  is  the 
demiurgos  of  the  real  world,  and  the  world  is  only  the 
external,  phenomenal  form  of  the  Idea.  With  me,  on  the 
contrary,  the  ideal  is  nothing  else  than  the  material  world 
reflected  by'Tlie  Human  mind,  and  translated  into  forms  of 
thought." 

The  dialectic  now  became  a  simple  affair.  It  was,  as 
Engels  observes  in  his  "  Anti-Duhring,"  "  nothing  but  the 
science  of  the  universal  laws  of  motion  and  evolution  in 
nature,  human  society,  and  thought."  That  is  to  say, 
Marx  and  Engels  transferred  the  thought  of  relativity 
from  the  field  of  psychology,  or  better  still  of  induction, 
to  the  field  of  historiography.  It  was  clear  to  them  that 
what  Hegel  treated  only  as  a  mode  of  individual  reason- 
ing was  really  a  principle  of  progress  by  which  past  and 
future  might  be  explained.  If  one  judgment  gives  rise 
to  an  opposite  the  fusion  of  the  two  being  a  new  truth, 
then  surely  historical  epochs  could  similarly  move  by  ex- 
tremes. If  contradiction  was  the  leading  characteristic  of 
cognition,  why  not  overlapping  of  ideas  and  conditions  the 
core  of  history  ?  If  we  have  partial  identity  in  a  continu- 
ous flux  of  realities,  why  should  not  different  historical 
epochs  be  linked  by  institutions  only  partly  in  harmony 
with  them  ?  The  predetermination  of  conclusions  by  their 
premises  surely  had  a  counterpart  in  the  casual  connec- 
tion between  successive  environments,  their  particulars 
and  interlaced  aspects. 

§  3.  The  Marxian  Statement  of  the  Economic  Inter- 
pretation of  History. —  Thus  the  Logic  of  Hegel  was  con- 
verted by  Marx  and  Engels  into  a  temporal  process  gov- 
erning the  life  of  nations.  What  some  have  dubbed  Eco- 
nomic Determinism  is  the  outgrowth  of  Hegelian  dialec- 


54  THE  LIMITS  OF  SOCIALISM 

tics.8  From  the  Enzyklopsedie  to  "  Das  Kapital,"  this  is 
a  true  line  of  descent !  The  Hegelian  method,  some  have 
argued,  was  vigorously  applied  in  Marx's  analysis  of  ex- 
change and  surplus  value.  No  doubt  one  may  defend  that 
view.  But  more  direct  is  the  relation  between  Hegelian 
metaphysics  and  the  prosaic,  empirical  concept  of  his- 
tory by  which  the  indictment  spread  before  us  in  Kapital 
is  reduced  to  a  mere  detail. 

The  economic  version  of  history  develops  rapidly  in 
Marx's  mind  after  Hegel  and  the  Hegelian  Left  had  chal- 
lenged his  attention.  His  intimate  associations  with  the 
radicals  in  philosophy  furthered  greatly  his  intellectual 
progress.  As  early  as  1843,  a  propos  of  a  review  of 
Hegel's  Rechtsphilosophie,  Marx  says :  "  Theories  among 
people  are  put  into  realization  only  so  far  as  its  practical 
needs  demand.  It  isn't  enough  that  ideas  urge  us  to 
action ;  the  actualities  about  us  must  generate  the 
thoughts  themselves  before  they  may  become  prac- 
ticable." "  We  insist,"  adds  Engels  at  a  much  later 
date,  "  that  all  hitherto  formulated  theories  on  ethics  are 
the  outgrowth,  at  last  analysis,  of  the  economic  condi- 
tions ruling  during  the  period  in  question."  Eighteenth 
century  materialism  was  thus  reapplied  in  a  novel  man- 
ner. The  static  view  was  displaced  by  the  dynamic. 
Motion  was  given  to  a  play  of  forces  once  pictured  as  at 
rest.  Social  facts  are  classified  and  compared  as  to  their 
antecedents  and  stage  of  evolution  relative  to  a  given 
epoch.  The  economic  interpretation  is  rounded  out,  and 

s  Compare  the  Marxian  view  with  Feuerbach,  L.,  in  "  Essence  of 
Christianity"  (translated  by  N.  Evans),  p.  23:  "Time,  and  not  the 
Hegelian  dialectic,  is  the  medium  for  uniting  opposites  in  one  and 
the  same  subject." 

»  Reprint  in  Mehring,  F.  Nachlass,  Volume  I. 

10  Engels,  F.,  "  Anti-Diihring." 


INTEPRETATION  OF  HISTORY  55 

by  the  time  that  Marx  left  the  continent,  to  spend  the 
remainder  of  his  busy  life  on  English  soil,  the  materialis- 
tic conception  of  history  is  already  full-blown.  Modifi- 
cations were  later  allowed  by  Engels,11  doubtless  as  a  sop 
to  party  demands,  and  also  by  way  of  defense  against 
accusations  hurled  at  his  revered  friend,  but  for  all  un- 
biased students  the  passage  in  Marx's  "  Critique  of  Politi- 
cal Economy  "  will  rank  as  the  most  authoritative  and 
most  complete  statement  of  scientific  socialism. 

We  read  in  the  Critique,12  published  many  years  before 
the  first  volume  of  Kapital  came  from  the  press :  "  In  the 
social  production  which  men  carry  on  they  enter  into  defi- 
nite relations  that  are  indispensable  and  independent  of 
their  will.  These  relations  of  production  correspond  to  a 
definite  stage  of  development  of  their  material  powers  of 
production.  The  sum  total  of  these  relations  of  produc- 
tion constitutes  the  economic  structure  of  society  —  the 
real  foundation,  on  which  legal  and  political  superstruc- 
tures arise,  and  to  which  correspond  definite  forms  of  so- 
cial consciousness.  The  mode  of  production  in  material 
life  determines  the  general  character  of  the  social,  polit- 
ical, and  spiritual  processes  of  life.  It  is  not  the  con- 
sciousness of  men  that  determines  their  existence,  but  on 
the  contrary  their  social  existence  determines  their  con- 
sciousness." 

Let  us  note,  before  quoting  further,  that  the  material 
basis  of  life  is  said  to  consist  of  the  means  and  modes  of 
production,  and  that  these  give  rise  to  "  relations  of  pro- 
duction "  which  in  turn  furnish  the  substratum  for  all 
non-economic  relations.  Thus  law  and  religion,  art  and 

11  Engels,     F.,     "  Der     StOzialistische     Akademiker,"     1895     (Zwei 
Briefe). 

12  Marx,    K.,    "Critique    of    Political    Economy,"    Preface,    1859. 
English  translation  by  N.  I.  Stone,  published  by  Ch.  Kerr  &  Co. 


56  THE  LIMITS  OF  SOCIALISM 

science  receive  their  impress  from  the  mold  into  which 
they  are  (according  to  Marx)  necessarily  cast. 

But  Marx  goes  on  to  show  how  economic  relations  are 
everchanging,  the  superstructure  therefore  becoming  like- 
wise unstable.  Different  rates  of  change  are  virtually  re- 
ferred to.  A  maladaptation  of  customs  to  conditions  in 
the  concrete  is  the  result  which  is  generally  accompanied 
by  social  unrest.  The  Zeitgeist  "  must  be  explained  from 
the  contradictions  in  our  collective  living,  from  the  exist- 
ing conflict  between  the  social  forces  of  production  and  the 
relations  of  production."  These  latter  are  known  to  us 
as  "  the  property  relations  "  because  of  the  stage  of  eco- 
nomic development  that  mankind  has  now  arrived  at. 
When  the  faultline  in  these  strata  of  social  life  becomes 
too  marked  an  upheaval  may  naturally  be  expected. 
Changes  then  will  come  rapidly.  In  the  facts  of  the  pres- 
ent moment  we  have  the  part  determiners  of  a  future 
crisis,  a  thought  put  by  Marx  as  follows :  "  No  social  or- 
der ever  disappears  before  all  the  productive  forces,  for 
which  there  is  room  in  it,  have  been  developed;  and  hew, 
higher  relations  of  production  never  appear  before  the  ma- 
terial conditions  of  their  existence  have  matured  in  the 
womb  of  the  old  society.  Therefore  mankind  always 
takes  up  only  such  problems  as  it  can  solve,  since,  looking 
at  the  matter  more  closely,  we  will  always  find  that  the 
problem  itself  arises  only  when  the  material  conditions 
necessary  to  its  solution  already  exist,  or  at  least  are  in 
the  process  of  formation." 

By  this  route  then  Marx  has  finally  reached  the  point 
which  relates  most  closely  to  his  practical  aims.  He  re- 
minds us  of  the  cosmic  principle  governing  all  life,  and 
adds :  "  The  bourgeois  relations  of  production  are  the 
last  antagonistic  form  of  the  social  process  of  production 
—  antagonistic  not  in  the  sense  of  individual  antagonism, 


INTEPRETATION  OF  HISTORY  57 

but  antagonism  arising  from  conditions  surrounding  the 
life  of  individuals  in  society.  But  at  the  same  time  the 
productive  forces  developing  in  the  work  of  bourgeois  so- 
ciety create  the  material  conditions  for  the  solution  of 
that  antagonism." 

The  economic  analysis  thus  becomes  simply  a  monu- 
mental proof  of  a  theorem  regarding  historical  evolution. 
Surplus  theory  and  the  socialization  of  capital  are  con- 
cepts centering  about  the  Economic  Interpretation  of  His- 
tory. The  misery  of  the  masses,  Marx  demonstrates,  is 
bound  to  end  because  beliefs  and  laws  change  with  the 
material,  economic  environment.  The  case  of  the  prole- 
tariat rests  with  the  gods  who  laid  down  a  mighty  prin- 
ciple of  life,  but  also  with  man  to  the  extent  that  he  is 
able  to  utilize  the  principle.  Things  move  in  a  cycle,  or 
perhaps  we  should  say,  in  a  spiral  course  leading  upward. 
Capitalism  is  doomed,  for  it  leads  to  exploitation  of  labor, 
to  overproduction  and  unemployment,  to  vast  combina- 
tions of  capital  destructive  of  small  enterprise,  and  hence 
to  rebellion  on  the  part  of  an  outraged  populace. 

The  Marxian  idea  of  history,  for  this  reason,  could  not 
fail  to  buoy  up  the  spirits  of  those  who,  resentful  of  their 
employers'  tactics,  yet  saw  no  way  of  regenerating  them 
by  peaceful  methods. 


CHAPTER  IV 

THE  ECONOMIC  INTERPRETATION  OF 
HISTORY   (Continued) 

|  i.  Importance  of  the  Economic  Interpretation  of 
History. —  A  correct  interpretation  of  history  is  im- 
portant because  of  its  bearing  on  our  future  conduct. 
Logically  we  should  be  guided  by  events  of  the  past,  for 
history  is  only  a  record  of  past  events  which  resulted  from 
the  interaction  of  human  nature  and  of  environment.  If 
as  a  result  of  certain  actions  a  situation  developed  which, 
in  reviewing  it,  we  dislike  we  should  feel  prompted  to  do 
differently  next  time.  This  is  the  significance  of  all  in- 
terpretations of  the  past,  the  Marxian  not  excluded. 

Marx  chose  three  points  in  his  contemplation  of  history 
and  made  these  his  loadstar  for  speculations  on  the  fu- 
ture. They  were  first,  a  division  of  events  into  the  eco- 
nomic and  non-economic,  second,  the  establishment  of  a 
causal  relation  between  the  two,  and  third  the  explanation 
of  misery  as  a  maladjustment  of  past  and  present.  Grant 
these  features,  and  the  paramount  importance  of  his  at- 
tempt must  appear  at  once.  History  consists  of  records 
of  past  events,  and  these  were  once  the  present.  The 
historian,  then,  treats  of  social  processes  as  well  as  the 
sociologist  or  economist,  only  he  studies  them  as  some- 
thing old  and  completed.  The  historian  speaks  of  com- 
pleted series  of  events;  the  student  of  contemporary 
events  regards  them  as  processes  still  under  way. 

A  critique  of  the  Marxian  economic  interpretation  of 
history  will  turn  on  the  points  made  by  Marx  himself,  but 

58 


INTEPRETATION  OF  HISTORY  59 

it  will  also  aim  to  restate,  when  necessary,  those  facts  of 
the  social  process  which  relate  to  the  Marxian  program 
of  reform.  If  socialism  wishes  to  change  the  social  order 
it  must  acquaint  dtself  with  the  precise  meaning  of  mal- 
adjustment, of  causal  relation,  and  of  the  economic  inter- 
pretation of  history  in  general.  Only  thus  can  it  obtain 
elements  for  a  theory  of  prosperity  which  it  seeks  to  for- 
mulate; only  thus  can  concepts  of  justice,  democracy,  and 
progress  assume  definiteness.  The  limits  as  well  as  the 
possibilities  of  socialism  are  given  by  the  analysis  of  the 
social  process  which  the  Marxian  interpretation  of  history 
involves. 

Marx  speaks  of  cause  and  effect.  He  held  the  economic 
data  responsible  for  the  character  of  the  superstructure. 
There  was  no  equivocation  on  that  subject.  He  is  very 
plain  in  his  statements.  But  what  is  cause  and  correla- 
tion? If  the  economic  and  non-economic  facts  are  re- 
lated, of  what  sort  is  this  correlation?  And  how  do  we 
find  such  interrelations?  The  Marxian  theorem  compels 
us  to  face  these  questions.  It  is  a  step  in  our  general 
appreciation  of  the  socialistic  platform  to  ascertain  the 
nature  of  cause  and  correlation.  Correlation  has  to  do 
with  the  grouping  of  events  that  fill  our  life.  Cause  has 
to  do  with  classifying  the  events  for  future  use.  The 
study  of  cause  and  effect  turns  on  a  selection  of  elements 
in  a  situation  with  a  view  to  forecasting  future  correla- 
tions or  to  controlling  them,  if  we  dare  and  care. 

§  2.  The  Problem  of  Correlation All  our  experi- 
ence is  of  events  happening  in  groups.  We  do  not  sense 
things  as  units  entirely  segregated  from  other  units  any 
more  than  we  see  individuals  living  as  hermits,  secluded 
from  the  rest  of  the  world.  Events  come  in  series,  in  suc- 
cession or  in  coexistence.  We  see  lightning  and  hear 
thunder.  We  look  out  into  the  street  and  behold  in- 


60  THE  LIMITS  OF  SOCIALISM. 

numerable  facts  related  in  various  ways :  the  children  play- 
ing by  groups,  the  traffic  in  a  certain  order,  the  array  of 
houses  and  the  framing  of  it  all  in  an  environment  of  sky 
and  nature  and  conditions  of  the  weather,  in  space  and 
in  time.  Everything  thus  appears  to  us  as  happening 
either  simultaneously  or  successively.  In  the  former  case, 
as  when  I  see  a  tree  with  its  trunk  and  foliage,  its  color 
and  size,  or  the  shape  of  its  leaves,  the  logician  speaks 
of  coexistence  of  facts.  In  the  latter  case,  when  for  in- 
stance the  clouds  gather  before  a  storm,  the  streets  next 
begin  to  be  pelted  with  big  drops  of  rain,  and  eventually 
a  gust  blows  amid  flashes  from  the  sky,  the  logician  speaks 
of  sequences.  The  events  happen  in  a  certain  order  in 
time. 

The  problem  of  correlation,  which  leads  up  to  the  ques- 
tion of  causation,  consists  of  two  parts.  The  first  is  the 
facts  of  remembrance  of  correlations,  and  the  second  is 
the  method  of  discovering  new  correlations  which  are  not 
obvious  to  the  sense.  The  picture  I  get  of  the  street  is 
one  presented  immediately  to  my  eye.  The  correlations 
are  discovered  by  being  seen.  That  is  all.  We  learn  in 
this  manner  to  adjust  ourselves  to  the  facts  present.  But 
without  memory  the  adjustment  would  be  incomplete,  since 
instinctive  reactions  do  not  always  answer.  The  differ- 
ence between  animal  and  man  is  largely  the  difference  in 
memory,  though  of  course  animals  also  remember  things. 

Our  ability  to  remember  is  grounded  in  the  facts  of 
metabolism  and  of  a  nervous  mechanism  which  have  been 
disclosed  chiefly  during  the  nineteenth  century.  For  the 
psychologist  the  fundamental  facts  in  consciousness  are 
sensation,  selection,  and  memory.  We  have  the  principle 
of  sensing  things,  of  being  stimulated  and  responding,  of 
responding  not  to  all  stimuli,  but  only  to  some,  and  of 
storing  impressions  so  they  may  color  future  impressions. 


INTEPRETATION  OF  HISTORY  61 

This  trio  of  principles  forms  the  foundation  on  which 
most  facts  of  consciousness  and  behavior  rest.  But  for 
the  purposes  in  hand  it  is  more  convenient  to  take  sensa- 
tion for  granted,  and  to  single  out  for  special  mention  the 
nature  of  association,  before  trying  to  understand  cause 
and  effect. 

We  are  stimulated  from  the  outside,  that  is  peripherally, 
o*r  from  within,  that  is  centrally.  Anything  calculated 
to  produce  physico-chemical  changes,  no  matter  how 
minute,  in  our  body,  represents  a  stimulus.  We  live  in 
the  midst  of  such  excitations,  and  we  respond  to  them 
often.  One  stimulus  may  produce  several  distinct  reac- 
tions, or  one  reaction  may  be  the  result  of  several  stimuli. 
This  follows  from  the  interlacing  of  the  carriers  of  excita- 
tion. 

-  The  human  body,  in  one  aspect,  is  a  vast  network  of 
nerves,  and  the  nervous  mechanism  is  a  system  of  conduc- 
tion units  by  which  stimuli  are  converted  into  more  or  less 
complex  responses.  The  unit  is  the  neurone  of  which  bil- 
lions exist,  and  over  which  stimuli  are  transmitted  to 
reach  the  proper  centers  and  connections  that  ensure 
suitable  reaction.  The  end  of  life  is  action ;  the  purpose 
of  the  neurone  is  the  conduction  of  stimuli  for  right  reac- 
tion. In  a  reflex  action  the  stimulus  is  carried  over  a 
simple  arc  connecting  receptor  with  motor  organ.  The 
twitch  of  a  muscle  is  a  case  in  hand.  But  the  great  ma- 
jority of  reactions  are  established  more  circuitously,  by 
means  of  switchings  of  excitation,  of  redirection  in  the 
spine  and  in  the  cortex,  so  that  highly  elaborated  series  of 
movements,  of  ideas  and  feelings  become  possible. 

And  this  is  particularly  made  possible  by  the  capacity 
of  the  organism  to  remember.  Man  remembers  experi- 
ences. His  nervous  mechanism  is  said  to  respond  in  the 
sense  that  it  carries  stimuli,  and  carries  them  the  more 


62  THE  LIMITS  OF  SOCIALISM 

readily  the  oftener  they  come,  though  other  principles 
also  decide.  Physiologically  the  explanation  is  a  lessen- 
ing of  resistance  to  the  current  that  travels  over  the  neu- 
rones. It  is  inconsequential  whether  we  imagine  the  trans- 
mission as  one  akin  to  the  burning  of  a  fuse  leading  to 
discharge  and  detonation,  or  whether  the  transmission 
partakes  of  the  nature  of  an  electric  current.  But  it  is 
important  to  note  the  effect  of  repetition  upon  the  nerve 
cells.  The  places  at  which  the  neurones  connect  —  the 
synapses  —  yield  more  readily  to  a  second  or  third  than 
to  a  first  excitation,  other  things  being  equal.  It  is  like 
folding  a  garment.  Gradually  a  crease  is  made,  and  sub- 
sequent folding  is  easy;  it  follows  the  old  crease.  Thus 
paths  are  made  from  continual  walking  in  the  same  line. 
Thus  rivers  dig  their  channel  through  solid  rock.  And 
similarly  the  excitation  of  the  optical  nerve  survives  the 
stimulus  itself.  After-images  are  somewhat  like  memory. 
The  effect  outlasts  the  cause. 

We  learn  by  remembering,  that  is  by  reducing  the  re- 
sistance originally  offered  to  stimuli  and  to  their  passages. 
Either  we  are  naturally  predisposed  toward  the  accept- 
ance of  a  stimulus,  or  we  acquire  the  ability  to  receive  and 
transmit  it.  "  Learning,"  in  the  words  of  a  psychologist, 
"  is  a  process  of  making  easier  the  passage  of  an  impulse 
from  neurone  to  neurone."  1  The  function  of  education 
is  to  control  the  stimuli  reaching  us,  at  the  beginning  of 
life,  from  the  outside,  and  later  from  within  also.  It  is 
to  cull  out  the  bad,  to  strengthen  the  desirable,  and  to 
redirect  them  so  as  to  effectuate  the  best  possible  adjust- 
ments, that  we  receive  instruction. 

The  outward  proof  of  memorizing,  of  lessening  the  re- 
sistance to  impulses  and  their  transmission,  is  the  forming 

iPillsbury,  W.  B.,  "Essentials  of  Psychology."    Revised  Edition, 
p.  55. 


INTEPRETATION  OF  HISTORY  63 

of  habits.  Habituation  is  one  of  the  most  fruitful  of  all 
capacities.  It  is  the  most  common  of  traits.  ':•  We  all  be- 
come addicted  to  things ;  we  all  learn  to  react  habitually. 
We  learn,  in  short,  to  do  things  without  paying  attention, 
without  noticeable  effort,  without  being  conscious  of  the 
act  of  doing.  Thus  with  walking,  eating,  dressing,  play- 
ing an  instrument,  etc.,  etc.  Habituation  means  a  sense 
of  comfort  because  of  the  ease  with  which  things  are  done 
and  reacted  to.  It  is  not  merely  a  question  of  motor  re- 
actions, however ;  a  response  in  belief  and  ideals  is  equally 
in  point.  What  we  are  used  to  we  commonly  like  and 
prefer  to  strange  things.  The  strange  is  usually  distaste- 
ful to  us,  unless  some  features  in  it,  reminding  us  of 
features  in  familiar  things,  break  down  our  instinctive  or 
acquired  aversion. 

The  effect  of  frequent  repetition  is  therefore  an  atti- 
tude of  expectancy.  We  are  keyed  up  to  anticipate 
events,  and  to  react  suitably.  Experience  permits  us  thus 
to  save  time  and  energy.  Habituation  means  looking  for- 
ward to  events  because  they  happened  in  the  past.  If 
they  suddenly  cease  to  happen,  we  feel  disappointed  or 
queer.  Nothing  jars  like  habits  broken  off  at  short  no- 
tice, like  regularities  ending  of  a  sudden.  The  converse 
to  this  jarring  of  unforeseen  interruption  upon  our  nerves, 
upon  our  consciousness,  is  our  disposition  to  believe  the 
familiar  things,  and  to  believe  that  they  will  occur  again. 
So  many  successions  of  day  and  night,  for  instance,  have 
occurred  in  our  individual  lives,  that  the  non-recurrence 
is  thought  impossible.  It  is  only  when  other  experiences 
directly,  or  by  a  process  of  reasoning  soon  to  be  discussed, 
induce  us  to  consider  the  possibility  of  a  non-recurrence 
that  we  fail  to  believe  in  its  necessity.  Thus  with  the 
repeated  appearance  of  a  certain  number  in  the  throw  of 
the  dice.  Here  contrary  experiences  tend  to  weaken  our 


64  THE  LIMITS  OF  SOCIALISM 

attitude  of  expectation.  But  in  general  repetition  means 
anticipation,  or  as  the  logician  has  put  it :  We  infer  things 
by  way  of  enumeration.  We  number  events  and  then 
cherish  beliefs  accordingly.  If  winter  has  always,  or  so 
many  times,  brought  snow  and  ice,  we  expect  more  ice 
and  snow  the  next  winter.  We  learn  to  induce  future  oc- 
currences from  the  past. 

This  is  the  first  important  circumstance  in  a  study  of 
our  inference  and  correlation.  The  second  is  selection 
and  attention. 

Not  all  things  are  noticed  and  remembered.  Our  en- 
vironment consists  really  only  of  the  facts  we  react  upon. 
We  sense  things  according  to  definite  principles  and  ig- 
nore more  or  less  fulty  everything  else.  Or  we  see  things, 
but  do  not  pay  particular  attention  to  them,  that  is  we 
do  not  make  them  the  center  of  things,  we  do  not  focus  our 
mental  eye  upon  them  to  the  exclusion  of  much  else.  Only 
for  particular  purposes  do  we  single  out  events  for  pro- 
longed study.  Only  because  the  reaction  to  stimuli  serves 
to  protect  and  develop  our  interests  do  we  select  our 
stimuli.  Selection  is  a  necessary  corollary  to  spec- 
ialization of  means  and  ends  in  species,  each  specie  hav- 
,  ing  its  own  characteristics  of  needs  and  habits. 

Our  selection  of  possible  stimuli  is  governed  by  objective 
and  subjective  conditions.  The  intensity  of  the  stimulus 
is  an  example  of  the  first  kind ;  the  facts  of  training,  of 
the  second.  According  to  our  general  schooling  and  ex- 
perience, according  to  purposes  at  the  moment  when  the 
stimulus  is  present,  according  to  immediately  preceding 
sensations,  to  predispositions  inherited,  or  to  pressure 
brought  to  bear  upon  us  by  our  fellowmen,  we  notice  or 
ignore  things,  treat  them  indifferently  or  make  them  the 
special  subject  of  our  investigation.  We  shut  out  most 


INTEPRETATION  OF  HISTORY  65 

elements  in  a  given  situation  from  our  vision.  This  is 
true  not  only  in  an  optical  sense,  but  likewise  of  our 
method  of  learning. 

From  the  general  law  of  selection  follows  our  habit  of 
comparing  things.  Our  system  becomes  attuned  to  simi- 
lar stimuli  in  different  ensembles  of  facts,  or  to  different 
stimuli  in  like  ensemble  of  factsAxJLt  is  essential  to  the 
maintenance  of  life  to  discriminate  and  to  compare. 
From  infancy  on  we  classify  stimuli  and  develop  our  re- 
sponses specifically.  Classification  may  not  be  conspicu- 
ously carried  on ;  no  more  than  motor  reactions  always  de- 
pend on  concentration  of  effort.  But  comparison  and 
grouping  of  data  are  daily  practices  without  which  the  en- 
vironment could  not  be  mastered.  We  remember  to  se- 
lect and  compare,  and  we  also  select  our  stimuli  in  order 
to  learn  the  right  reactions. 

But  note  that  as  a  result  of  this  eternal  process  of  at- 
tention a  group  of  events  never  really  embraces  all  of  the 
factors  in  the  group.  In  a  thunder  storm,  e.  g.,  I  see 
many  things,  but  not  nearly  all.  I  select  only  as  my  in- 
stincts command,  or  as  experiences  seem  to  justify.  In- 
numerable elements  in  the  situation  called  a  thunderstorm 
remain  unobserved  by  me.  I  may  at  a  later  date  see  more 
of  them,  or  I  may  have  reasons  for  looking  for  more.  Or 
I  may  have  seen  a  greater  number  at  an  earlier  date,  but 
forgotten.  All  this  varies  and  depends  on  the  principles 
of  selection  and  remembering  already  referred  to.  In  this 
survey  the  only  notable  fact  is  the  variable  number  of 
facts  constituting  a  complete  situation  —  what  we  call 
the  correlation  regularly  recurring,  such  as  the  aforesaid 
thunderstorm.  We  seem  to  have  the  complete  situation, 
but  do  not,  as  later  experiences  may  prove.  For  practi- 
cal ends  at  a  given  moment  the  correlation  may  be  per- 


66  THE  LIMITS  OF  SOCIALISM 

*C"~ 

feet,  but  it  does  not  remain  so.  Our  perception,  in  short, 
is  of  selected  materials  in  a  structure.^/  We  perceive  sali- 
ent features,  what  to  us  seems  essential  according  to  par- 
ticular, perhaps  practical,  ends,  but  this  subjective  pic- 
ture may  not  correspond  to  reality,  or  what  at  another 
time  seems  reality.  Percepts  are  always  abstractions. 

But  before  fully  understanding  the  percept  the  prin- 
ciple of  association  must  be  invoked.  It  is  through  as- 
sociations that  we  greatly  enrich  our  power  of  reactions 
and  facilitate  our  search  for  new  truths. 

The  theory  of  association  may  be  stated  as  the  belief 
everywhere  held,  and  by  science  duly  recognized  as  a  fact, 
that  our  ideas  are  governed  by  the  past.  Connections  of 
the  past  govern  the  reproduction  of  ideas.  To  have  per- 
ceived means  not  only  to  recognize  by  force  of  memory, 
but  also  to  see  anew  in  the  light  of  experiences  not  per- 
haps directly  connected  with  the  prototype  of  the  par- 
ticular new  experience.  If  for  instance  I  have  seen  the 
striking  of  a  match  to  lead  to  ignition  I  may  remember 
this,  and  the  motions  involved  in  the  act  of  striking  will 
become  the  easier  the  oftener  I  repeat  the  performance. 
This  is  simply  a  case  of  memory.  But  the  effect  of  asso- 
ciation is  the  recall  of  events  not  happening  at  the  time  of 
recall.  To  see  a  match  struck,  for  instance,  and  to  recall 
the  sound  it  usually  makes,  without  hearing  it  at  the  time, 
that  is  memorizing  by  association. 

The  physiological  aspect  of  this  important  fact  lies  in 
the  intertwining  of  nerve  paths,  and  in  the  existence  of 
association  areas  in  the  cortex,  whose  function  is  primarily 
the  connecting  of  different  sensations,  or  of  movements 
with  sensations  for  adjustment  to  the  largest  possible 
number  of  stimuli.  To  quote  from  an  authority :  "  When 
a  group  of  neurones  was  active  at  the  time  of  the  original 
experience,  paths  of  connection  were  formed,  synapses 


INTEPRETATION  OF  HISTORY  67 

were  opened  between  them,  and  later,  when  any  element  of 
the  complex  is  aroused  in  any  way,  the  impulse  tends  to 
spread  over  the  partially  open  synapses  to  the  other  ele- 
ments of  the  whole."  2  That  is  to  say,  we  may  imagine 
different  nerve  paths  to  have  part  of  their  course  in  com- 
mon. They  converge  and  part  again.  Excitations  from 
different  sources  travel  partly  over  the  same  path,  and  at 
the  points  of  contiguity  of  the  neurones  they  are  connected 
so  that  one  stimulus  may  arouse  others,  and  lead  to  a  long 
series  of  reactions.  The  stimuli  may  be  aroused  peripher- 
ally or  centrally.  Ideas  are  for  the  purpose  of  the  psy- 
chologist as  truly  sensations  as  those  generated  by  out- 
side facts. 

The  principles  of  association  are  those  first  suggested 
by  the  Greeks,  namely  of  association  by  resemblance,  con- 
trast, contiguity  or  continuity.  But  evidently  this  is  a 
mere  classification,  not  an  explanation  of  the  process. 
Nor  are  the  four  truly  distinct,  since  resemblance  and  con- 
trast imply  comparisons  in  space  and  time,  which  prob- 
ably account  for  all  rearousals.  And  again,  as  our  writer 
admits,  the  association  is  more  truly  one  of  neurones  than 
of  ideas,  the  association  not  following  strictly  the  prin- 
ciples laid  down  by  the  ancients.  Thus  "  not  only  must 
we  limit  the  application  of  the  doctrine  of  associations  by 
the  assertion  that  it  is  the  neurones  at  the  basis  of  the 
elements  of  ideas  that  are  associated  rather  than  the  ideas 
themselves,  but  we  must  also  recognize  that  associations 
give  only  the  possibility  of  recall,  and  that  selection  must 
be  made  between  the  possibilities  by  more  remote  fac- 
tors." 3  We  do  not  associate  all  things  seen  together  in 
space  or  time.  Inhibitions  come  naturally,  and  are  spec- 
ially cultivated  by  education.  Thus  attention  becomes 

2Pillsbury,  W.  B.,  "Fundamentals  of  Psychology,"  p.  223. 
3  Ibidem,  p.  227. 


68  THE  LIMITS  OF  SOCIALISM 

fruitful,  and  adjustment  rapid  and  exact.  In  other 
words,  the  selective  forces  affect  association  as  well  as 
memory  itself. 

Yet  the  fundamental  fact  is  as  stated.  We  are  again 
and  again  led  to  recall  the  past  by  stimuli  in  the  present 
somehow  related  to  stimuli  in  an  earlier  situation.  The 
principle  reminds  one  of  the  Lamarckian  contention  ac- 
cording to  which  acquired  traits  are  inherited.  The  son, 
it  is  said,  will  act  somewhat  as  the  environment  made  the 
father  act,  even  though  the  son  lives  in  a  different  en- 
vironment. It  is  again  a  case  of  memory  and  habitua- 
tion,  but  this  time  by  indirect  stimulation.  Recall  in  this 
manner  enlarges  our  capacity  for  learning.  "  Learning," 
we  are  told,  "  is  always  the  formation  of  connections  be- 
tween neurones ;  retention  is  always  the  persistence  of  the 
connection,  or  the  partial  openness  of  synapses  which  per- 
mits an  impression  to  pass  from  one  to  the  other  of  the 
connected  elements :  recall  is  the  rearousal  of  the  whole 
complex  by  some  one  of  the  elements  that  may  be  stimu- 
lated from  the  outside  world,  directly  or  indirectly."  4 
A  part  suffices  to  arouse  the  whole;  that  is  the  main 
characteristic  of  association. 

A  distinction  should,  however,  be  made  between  recall  of 
events  regularly  correlated,  and  a  recall  of  events  which 
only  in  part  recur  regularly.  If,  to  return  to  the  illustra- 
tion of  the  match,  I  expect  ignition  at  the  striking  of  a 
match  because  it  has  always  resulted  in  ignition,  this  is 
direct  association  of  events  invariably  coupled.  They 
belong  together  as  integral  parts  of  a  series,  and  have  so 
been  classified.  But  if,  on  hearing  a  melody,  I  am  re- 
minded of  childhood  scenes,  and  then  perhaps  of  a  long 
chain  of  happenings  covering  many  years,  relating  to 
places  and  persons  nowhere  before  me  now  while  I  hear 

*  Ibidem,  p.  225. 


INTEPRETATION  OF  HISTORY  69 

the  melody,  then  the  association  is  indirect,  of  things  not 
regularly  recurring  or  correlated.  The  only  binding  link 
is  perchance  a  single  quality  of  tone,  or  a  mistake  made  in 
playing  the  instrument,  or  a  peculiar  way  of  ending  the 
performance,  and  so  on.  A  few  elements  are  sufficient  to 
reconstruct  all  the  elements,  or  at  least  a  great  many  ele- 
ments, in  the  older  situation.  The  one  thing  held  in  com- 
mon by  the  old  and  tho  new  series  of  events  is  responsible 
for  the  recall  of  all  the  rest  in  the  old  series.  Thus  ideas 
skip  and  travel  at  an  amazing  rate.  Thus  in  the  twinkle 
of  an  eye  one  may  traverse  the  universe  and  rehearse  a 
lifetime  of  struggles.  Indirect  association  is  the  import- 
ant principle  for  the  extension  of  our  knowledge,  and  for 
the  understanding  of  trifles  in  our  daily  conduct.  It  is 
the  transfer  of  ideas  that  counts,  more  than  the  recol- 
lection of  events  experienced  together  regularly.  Or,  to 
put  it  differently,  the  association  by  resemblance  (or  con- 
trast) is  far  more  important  than  association  by  con- 
tiguity and  succession.  The  latter  helps  to  explain  ex- 
pectation and  beliefs,  but  the  former  is  instrumental  in 
multiplying  the  data  for  belief. 

Just  what  elements  in  the  new  sensations  guide  my  con- 
catenation of  thoughts,  and  in  what  direction  it  ultimately 
leads  me,  depends,  as  already  remarked,  to  some  extent 
upon  the  general  laws  of  selection.  I  am  sure  to  be  in- 
fluenced by  previous  associations,  by  moods  of  the  moment, 
by  ideas  uppermost  in  my  mind,  by  facts  of  temperament 
and  of  training.  They  all  determine  the  scope  and  nature 
of  my  transfer  of  ideas,  they  all  influence  us  in  our  search 
for  new  facts. 

The  principles  of  finding  a  new  correlation  connect  with 
this  circumstance.  If  the  correlation  is  not  one  directly 
submitted  to  my  senses,  such  as  the  sequence  of  work  and 
fatigue,  or  the  coexistence  of  flame  and  heat,  special  ef- 


70  THE  LIMITS  OF  SOCIALISM 

forts  must  be  made  to  find  it.  This  is  our  task  from  birth 
to  death.  We  continually  look  for  new  groups  of  events, 
see  them  repeat  themselves,  and  add  one  correlation  to  the 
next  by  virtue  of  memory  and  selection. 

One  way  of  ascertaining  new  correlations  is  to  try  out 
alternatives.  If,  for  instance,  I  cannot  open  a  door  which 
I  have  opened  often  and  expect  to  be  able  to  open  by  the 
usual  method,  I  will  be  puzzled  for  a  while  and  then  look 
for  the  cause.  That  is,  since  just  now  we  are  not  in- 
terested in  cause  per  se  —  I  will  try  to  get  the  complete 
set  of  facts  connected  with  the  impossibility  of  opening 
the  door.  I  may  try  to  lift  it  by  the  knob,  or  press  it 
downward  or  push  it  toward  me  or  from  me,  or  shake  it, 
or  look  for  obstructions  on  either  side  if  I  can  do  so.  I 
go  on  the  supposition  that  many  elements  go  into  the 
situation  which  is  new  to  me,  and  that  I  may  hit  upon 
some  elements  essential  to  its  not  opening,  just  as  I  had 
known  some  elements  to  be  essential  to  its  opening.  I 
may  come  upon  the  factors  and  remember  them. 

Or  suppose  I  have  a  watch  which  keeps  good  time  in 
one  place,  but  loses  time  in  another.  If  I  feel  so  inclined 
I  may  ascertain  the  pertinent  facts  at  random.  Let  us 
assume,  at  any  rate,  that  I  am  guided  by  no  prior  experi- 
ence of  any  kind,  an  abstraction  permissible  for  the  pur- 
pose. I  then  might  use  my  developed  powers  of  selection 
and  attention.  I  begin  to  compare  two  different  situ- 
ations and  to  classify  events  according  to  resemblance  and 
difference.  I  say,  here  is  my  habit  of  wearing  the  watch, 
the  way  it  lies  in  my  pocket,  the  way  and  time  in  and  at 
which  I  wind  it  up,  the  facts  about  the  watch  itself,  my 
way  of  walking  and  using  it  when  consulting  the  dial. 
And  so  on.  I  may  enumerate  and  put  in  two  columns  the 
facts  I  hold  alike  and  those  peculiar  to  each  situation.  It 


INTEPRETATION  OF  HISTORY  71 

is  likely  that  I  find  many  similarities  and  some  differences. 

The  whole  procedure  so  far  is  that  made  famous  by 
Mill's  canons  of  induction.  I  compare  and  tabulate  re- 
sults. Mill  pointed  out  that  where  all  things  except  one 
are  held  in  common  by  two  or  more  different  situations 
the  one  differential  assumes  unusual  significance.  But  let 
us  note  simply  that  at  last  I  have  found  some  differences 
which  I  think  sufficient  to  round  out  the  new  situation  in 
which  the  watch  does  not  keep  time.  I  may  now  take  the 
watch  several  times  from  one  place  to  the  other  and  note 
that  each  time  in  place  A  it  runs  accurately,  and  in  place 
B  it  falls  behind.  If  I  repeat  this  often  enough,  what  will 
be  the  effect  on  my  opinion  about  the  watch?  I  shall 
simply  come  to  believe  that  in  the  future  also  the  watch 
will  fail  me  in  one  situation,  but  respond  well  in  the  other. 
The  force  of  repetition  will  set  in  as  usual.  On  the  prin- 
ciple of  induction  by  enumeration  I  shall  develop  a  belief 
that  past  correlations  will  recur.  I  shall  speak  of  a  law, 
for  the  watch,  of  keeping  time  and  losing  time  respectively 
in  two  different  places.  Laws  are  nothing  but  such  regu- 
lar recurrences  of  sequences  and  coexistences,  as  logicians 
found  out  centuries  ago. 

Very  well.  But  it  is  not  likely  that  I  shall  experiment  in 
that  fashion.  Scientists  particularly  do  not  ascertain 
new  correlations,  that  elude  the  five  senses,  in  such  a  hap- 
hazard manner.  They  proceed  with  some  eye  to  economy. 
They  select  the  facts  to  be  watched,  and  shape  before- 
hand their  plans.  How,  then,  are  thinkers  as  a  rule 
guided?  What  is  the  modus  operandi  in  reasoning? 
What  is  the  approved  and  common  method  of  inference? 

It  is  reasoning  ~by  analogy.  It  is  by  resort  to  mem- 
ory and  association.  Instead  of  dwelling  long  on  deduc- 
tion and  canons  of  induction  Mill,  as  modern  psychology 


72  THE  LIMITS  OF  SOCIALISM 

sees  it,  might  have  better  put  analogies  in  the  foreground 
of  his  discussion.  Inference  by  analogy  is  the  rule  rather 
than  the  exception.  And  not  only  that,  it  also  marks  the 
nature  and  limits  of  most  of  our  knowledge. 

In  the  case  of  my  watch,  then,  I  shall  do  as  I  did  when 
trying  to  open  the  door.  I  shall  proceed  by  hypotheca- 
tion in  accord  with  the  dictates  of  association  and  mem- 
ory. I  tried  to  open  the  door  by  lifting  or  downward 
pressing  at  the  knob,  because  I  knew  that  wood  swelled, 
and  that  this  might  make  the  opening  difficult.  Only 
after  these  expedients  failed  would  I  normally  look  for 
other  faults,  or  for  some  one  on  the  other  side  holding  the 
door,  or  for  its  being  locked  contrary  to  orders. 

As  to  the  watch,  I  cast  about  for  explanations  also. 
That  is,  I  cast  about  for  groups  of  events  which  in  their 
entirety  would  give  the  experienced  result.  I  am  influ- 
enced by  the  principle  of  association.  I  look  for  a  factor 
which  other  situations  share  with  the  new  one.  Or  rather, 
one  or  more  elements  in  the  new  situation  remind  me  of 
other  situations  containing  many  more  than  the  particu- 
lar factors.  I  am  led  to  make  comparison  in  a  certain 
direction.  Guided  by  knowledge,  we  say.  Yes,  guided 
by  knowledge,  or  by  a  fund  of  associations,  which  is  much 
the  same  thing.  Instead  of  finding  the  differentials  there- 
fore by  piecemeal  classification  and  enumeration  I  resort 
to  a  circuitous  method.  I  do  in  reasoning  what  the  en- 
terpriser does  when  he  substitutes  machinery  for  manual 
work.  I  take  indirect  routes  which  at  first  have  cost 
much  effort  and  time,  but  by  their  aid  I  can  now  achieve 
results  more  expeditiously. 

I  am  willing  to  look  for  differences  and  resemblances  by 
comparing  a  former  situation  with  the  present,  because  in 
the  past  such  partial  resemblances  have  meant  resemblance 
m  toto.  Association  directs  me;  but  it  does  not  affect 


INTEPBETATION  OF  HISTORY  73 

us  all  equally.  Association  leads  to  observation  of  like- 
nesses and  unlikenesses.  A  few  of  them  are  quickly  noted 
and  kept  in  mind.  And  now  I  fall  back  again  on  the  prin- 
ciple of  enumeration.  Since  up  to  date  situations  have 
proven  alike  in  all  parts  when  only  some  of  them  were  for- 
merly observed  to  be  alike,  and  since  I  have  witnessed  long 
chains  of  happenings  to  recur  exactly  as  I  predicted  after 
having  found  some  of  the  happenings  similar  to  some  no- 
ticed at  other  times,  I  infer  a  like  aggregate  result  for 
similar  future  chains  of  happenings.  And  furthermore, 
the  fact  that  part  resemblances  often  mean  complete  re- 
semblance, and  that  a  recurrence  of  a  former  entire  series 
is  the  likelier  the  more  nearly  its  beginning  events  resemble 
those  of  an  older  correlation,  also  induces  me  to  compare 
the  nature  of  the  resemblance. 

But  my  faith  is  reenforced  from  still  another  quarter. 
Namely,  it  is  a  common  observation  that  the  distribu- 
tion of  events  is  either  regular  or  irregular.  If  regular  I 
attribute  it  to  a  law  of  nature  which  comprises  the  regu- 
larities just  discussed  —  correlations  which  form  the  bulk 
of  scientific  knowledge.  Or  I  attribute  it  to  human  inter- 
ference and  design.  Man  always  places  himself  in  the 
middle  of  a  situation.  He  feels  himself  to  be  the  planner 
and  architect  of  his  fortunes.  When  he  acts,  the  results 
of  regularity  are  of  his  making  and  hence,  he  avers,  ex- 
plained. But  when  neither  a  natural  law  nor  the  hand  of 
man  can  be  predicated  as  part  of  the  regularity  of  events 
their  distribution  is  felt  to  be  a  chance  event.  An  ir- 
regularity is  expected.  We  see  irregularity  where  we  do 
not  refer  one  group  of  facts  to  another  group,  just  as  we 
ascribe  to  chance  what  is  really  an  unknown  principle 
about  which  perhaps  we  care  nothing. 

Probability  then  is  a  forecast  based  on  retrospects. 
The  chance  of  regularity  is  the  greater  the  more  definite 


74  THE  LIMITS  OF  SOCIALISM 

our  comprehension  of  laws  or  of  human  design  back  of  it. 
And  my  belief  that  a  whole  series  of  events  will  recur 
when  some  of  them  have  in  the  past  proven  to  be  part  of 
a  particular  larger  series,  is  the  stronger  the  greater  the 
number  of  events  common  to  both  situations.  The  more 
resemblances  pile  up,  and  the  oftener  they  recur,  the  more 
convinced  I  am  that  the  entire  series  is  of  the  old  sort ; 
and  I  am  willing  to  predict  accordingly.  This  is  the 
reason  for  my  inferring  things  by  analogy.  In  this  man- 
ner I  am  led  to  discover  the  new  correlation  centering 
about  my  watch  when  it  loses  time.  Thuswise  the  prin- 
ciples of  association,  selection,  and  memory  collaborate  to 
help  me  discover  new  truths. 

Reasoning  by  analogy  indeed  becomes  so  habitual  that 
often  we  are  unaware  of  using  it.  Thus  recognition  of 
things  may  be  regarded  as  much  as  an  act  of  inference  as 
of  mere  perception.  A  physician,  for  instance,  may  not 
diagnose  a  case  by  exhaustive,  systematic  enumeration  of 
symptoms  as  observed  in  the  study  of  my  watch.  As- 
sociation may  be  direct  and  suggest  at  once  the  nature  of 
the  disease.  He  sees  certain  events  or  characteristics,  is 
reminded  of  similar  ones  connecting  with  a  malady  called 
scarlet  fever,  and  at  once  pronounces  the  new  case  to  be 
one  of  scarlet  fever.  The  tendency  to  recognize  things  as 
alike  is  always  strong,  when  some  one  element  of  similarity 
exists.  And  the  fact  that  a  disease  is  in  question 
strengthens  the  inclination  to  infer  from  analogy.  But 
of  course,  this  first  recognition  may  soon  be  superseded  by 
cautious  study.  If  contradictory  evidence  presents  itself 
new  lines  of  associations  and  of  reasoning  will  be  opened. 

If  I  see  some  objects  on  a  table,  looking  round  and  red- 
dish, of  a  certain  texture  and  size  or  shape,  I  will  imme- 
diately call  them  apples,  and  all  of  them  apples,  without 
having  compared  them  carefully  with  another  object 


INTEPRETATION  OF  HISTORY  75 

known  to  be  an  apple,  or  even  without  rehearsing  my  own 
experiences  with  like  objects.  Recognition,  that  is  "  the 
reference  of  an  event  or  object  to  some  earlier  time  and 
place,"  5  satisfies  the  needs  of  the  case.  Thus  also,  if  a 
boy  should  be  run  over  by  a  vehicle,  or  somebody  fall  down 
the  stairway  and  appear  to  be  seriously  injured.  I  have 
seen  no  details,  but  infer  so  quickly  by  association  that 
the  recognition  is  almost  a  single  act.  I  believe  the  entire 
situation  to  be  such  and  such  because  part  of  it  resembles 
an  earlier  one  of  a  certain  kind.  In  brief,  my  perception 
is  a  partial  summary  of  events  which  are  rearoused  by  new 
events. 

The  percept  is  a  compound  much  as  water  is  one.  The 
joint  result  of  individual  actions  is  no  mere  summation, 
but  a  new  product.  Perception  is  more  than  association 
if  that  is  to  mean  a  stringing  together  of  sensations,  as 
we  might  thread  pearls.  The  Herbartian  doctrine  of  ap- 
perception was  a  great  step  in  advance  precisely  because 
it  realized  this  characteristic  Q£  perception  and  freed  us 
from  the  older  mechanistic  notion./ 

"Percepts,"  according  to'^one  psychologist,  "are  se- 
lected groups  of  sensations  in  which  images  are  incor- 
porated as  an  integral  part  of  the  whole  process."  6  In 
the  words  of  another  competent  authority,  quoted  several 
times  before,  "  the  world  that  we  have  in  memory  or  in 
reason  is  not  the  sum  of  particular  experiences;  it  is  al- 
ways the  mass  of  particular  experiences  worked  over,  and 
crystallized  about  standards."  7  "  What  is  perceived  is 
not  merely  a  mass  of  sensations  nor  is  it  a  single  sensation 
that  suggests  some  other  single  sensation  or  group  of  sen- 
sations ;  rather  is  it  a  type,  an  organized  product  of  many 

s  Ibidem,  p.  366. 

«Titchener,  E.  B.,  "Textbook  of  Psychology,"  p.  367. 

7  Pillsbury,  W.  B.,  "  Psychology  of  Reasoning,"  p.  76. 


76  THE  LIMITS  OF  SOCIALISM 

experiences  which  have  finally  given  rise  to  a  construct 
consistent  with  all  of  our  different  related  experiences."  8 
The  percept,  then,  is  the  result  of  many  correlations  not 
having  all  events  in  common,  but  many  of  them.  Percepts 
are  averages,  so  to  say.  Roughly  speaking  they  describe 
situations,  but  each  new  situation  will  have  its  own  pecu- 
liarities, and  each  new  act  of  sensing  will  reckon  with  the 
differences. 

I  perceive  what  is  important,  and  I  sense  what  is  con- 
spicuous. A  picture  is  an  abstract  for  that  reason.  It 
has  meaning  because  I  see  only  part  of  the  lines  and  planes 
in  it,  and  not  all,  and  because  I  see  them  in  certain  rela- 
tions of  space  to  each  other.  My  perspective  is  spoiled 
when  I  step  too  close.  The  picture  goes  and  a  tangle  of 
lines  and  dots  is  left,  but  it  conveys  no  idea.  It  only  ir- 
ritates me.  Thus  everything  perceived  is  a  cluster  of  ele- 
ments many  of  which  recur  over  and  over  again,  in  ap- 
proximately the  same  juxtaposition  of  time  and  space. 
But  the  fact  that  percepts  are  only  approximations  is  of 
great  importance  to  our  analysis  of  correlation  and  cause, 
for  by  virtue  of  it  science  becomes  fallible  and  plastic, 
subject  to  correlation  and  growth,  an  estimate  rather  than 
a  set  of  laws  immutable  for  all  times. 

It  is  not  necessary  to  preach  phenomenalism  in  order 
to  agree  to  the  relativity  of  scientific  truths.  Nor  will  all 
assent  to  William  James'  dictum  that  pragmatists  are 
necessarily  realists.  The  core  of  the  epistemological 
problem  is  the  fact  of  reasoning,  which  is  based  on  data 
of  psychology.  The  Beyond  need  not  detain  us,  espec- 
ially since  all  philosophies  of  the  absolute  have  broken 
down  by  assuming  part  of  what  they  sought  to  demon- 
strate independently. 

sPillsbury,  W.  B.,  "Fundamentals  of  Psychology,"  pp.  395-96. 
See  also  the  same  writer's  "  Psychology  of  Reasoning,"  pp.  90  &  97. 


INTEPRETATION  OF  HISTORY  77 

But  there  is  no  doubt  that  inference  by  analogy  ac- 
counts for  most  of  our  beliefs  and  of  our  knowledge  even 
such  as  is  verified  in  an  objective  sense.  The  thought  of 
chance  distribution  and  of  probability  is  doubtless  a  prod- 
uct of  such  reasoning.  The  explanation  here  offered  of 
the  method  for  discovering  new  correlations  is  itself  an 
instance  of  inference  from  analogy.  And  mathematics 
and  history  are  almost  entirely  limited  to  such  procedure, 
the  latter  admitting  it  frankly,  while  the  latter  was  long 
held  to  work  with  instruments  infallible  and  inscrutable. 
Historians  reason  by  reference  to  occurrences  in  their  own 
environment,  or  by  deductions  from  human  nature,  that 
is  by  analogy.  The  great  bulk  of  verities  that  the  social 
student  and  ethicists  of  the  old  type  gave  to  the  world 
were  unprovable.  They  were  true  in  so  far  as  they  ac- 
corded with  the  principles  of  thinking  just  mentioned. 
Put  otherwise:  They  were  and  always  will  be  true  in  so 
far  as  modes  of  thinking  among  men  are  the  same,  due  to 
millions  of  years  of  environments  shared  in  common  by  our 
ancestors.  Evolution  has  made  us  in  some  things  alike, 
and  our  reasoning  process  is  part  of  this  universal  hu- 
man nature,  though  our  funds  of  knowledge  and  of  as- 
sociations, and  hence  the  trend  and  power  of  our  reason- 
i/ng  vary  enormously.  Sociological  events  are  scattered  in 
time  and  place.  Besides,  they  are  non-reproducible  in 
their  entirety.  We  express  this  by  admitting  that  an  in- 
determinate number  of  factors  enter  into  a  given  situa- 
tion, whose  control  is  ordinarily  beyond  us.  In  this  sense 
most  sociological  events  cannot  be  "  proven."  Yet  we 
can  measure  by  averages  and  rejoice  in  the  recurrence  of 
averages  —  approximately  and  for  limited  period  of  time 
or  areas  or  groups  of  people.  Insurance  rates  thus  be- 
come possible,  though  rates  will  change  with  conditions. 
Mortality  figures  thus  assume  much  definiteness.  and  are 


78  THE  LIMITS  OF  SOCIALISM 

deemed  reliable,  though  they  change  in  time  and  place. 
Averages,  for  that  matter,  prevail  everywhere,  both  in 
natural  and  social  science. 

Is  there  no  proof,  then?  Or  better:  What  is  proof? 
When  is  something  absolutely  true?  The  question  is 
natural  because  deduction  is  supposed  to  furnish  irrefut- 
able proofs  such  as  should  satisfy  the  most  ambitious  of 
metaphysicians. 

We  may  answer  yes  or  no  according  to  the  nature  of 
facts  in  question,  and  according  to  our  notion  of  truth. 
Proof  namely  is  in  the  eating  of  the  pudding,  which  means 
that  all  so-called  verification  ("  making  true  ")  is  by  ap- 
peal to  the  senses.  But  in  as  much  as  the  senses  differ  we 
cannot  believe  that  all  things  are  true  in  exactly  the  same 
way  to  all  people.  We  can  only  say  that  some  elements 
in  a  situation  will  be  perceived  by  all  in  like  manner,  and 
that  this  rough  correspondence  is  equivalent  to  proof.  A 
proposition  is  proven  when  demonstrated  to  the  eye  or  ear 
or  taste,  etc.  It  is  proven  true  when  it  "  works  well," 
when  the  application  of  science,  e.  g.,  brings  desired  re- 
sults. This  does  not  mean  that  truth  depends  on  appli- 
cation, or  science  on  commercialization.  No,  it  means 
simply  that  some  judgments  are  true  to  all  in  so  far  as 
our  sensing  or  perceptions  veer  about  types  common  to 
us  all. 

But  where  objective  verification  is  impossible,  as  in  the 
case  with  most  of  the  verdicts  of  social  science,  there  be- 
lief of  experts  is  tantamount  to  proof.  The  general  run 
of  people  will  accept  expert  advice  as  truth  because  they 
are  swayed  naturally  by  superiority  or  by  the  socialized 
agents  of  control.  .  And  if  both  verification  and  expert- 
ness  are  lacking,  then  the  opinion  of  the  majority  becomes 
the  standard.  Mere  number  wins  in  many  cases.  For 
want  of  better  evidence  we  go  to  the  multitude.  Thus 


INTEPRETATION  OF  HISTORY  79 

public  opinion  becomes  truth,  and  thus  our  ideals  seem  to 
us  indisputable  truths.  We  have  arrived  at  them  by  much 
the  same  methods  of  reasoning  that  the  scientist  uses. 
The  ways  of  common  sense  are  the  ways  of  science. 

The  chief  difference  between  the  layman  and  the  scien- 
tist is  therefore  not  one  of  methods,  but  one  of  instru- 
ments and  results.  Science  has  inestimable  advantages 
in  control,  measurement,  and  associations.  It  may  iso- 
late phenomena,  select  its  facts  carefully  and  place  them 
in  surroundings  that  make  observation  of  details  possible 
and  easy.  It  uses  artificial  means  of  reproducing  events 
so  as  to  be  able  to  know  exactly  what  is  going  on.  This 
power  of  rehearsing  the  course  of  events  in  a  given  correla- 
tion leads  to  the  establishment  of  new  correlations  by 
elimination  and  introduction  of  factors  chosen  for  special 
purposes.  A  plan  of  action  characterizes  the  investiga- 
tions of  the  professional  which  the  tyro  rarely  knows  of. 

And  besides,  there  are  means  of  measurement  vastly  su- 
perior to  the  ordinary.  An  indirect  method  is  here  the 
chief  advantage.  Differences  in  weight  and  length,  in 
force  and  volume  that  could  not  be  detected  by  the  naked 
eye  become  marked  as  soon  as  special  devices  are  called 
into  service.  The  micrometer  and  the  seismograph,  the 
stop-watch  and  galvanometer,  or  the  vacuum-balance  are 
invaluable  aids  in  minute  differentiations  that  may  lead  to 
a  new  conception  of  the  situation  studied. 

The  fund  of  associations  grows  steadily ;  partly  be- 
cause records  are  filed  for  future  reference  so  that  the 
memory  of  science  is  made  more  reliable  than  that  of  the 
average  individual,  and  partly  because  incessant  spec- 
ialized study  enlarges  the  fund  of  known  facts  that  will 
serve  to  stimulate  further  inference.  From  the  known  to 
the  unknown  is  always  the  course  in  learning,  but  it  has 
special  significance  for  the  trained  investigator  who  de- 


80  THE  LIMITS  OF  SOCIALISM 

liberately  sets  himself  problems  remote  from  everyday  ex- 
periences. A  large  fund  of  associations  is  indispensable  in 
his  undertaking.  The  greater  the  number  of  correla- 
tions, the  larger  is  the  choice  of  resemblances  and  differ- 
ences, and  consequently  the  less  liable  to  error  the  reason- 
ing from  analogy.  Verification  may  or  may  not  be  de- 
finitive, but  the  subsumption  of  a  new  particular  under 
an  old  generality  is  facilitated  by  the  increase  of  facts  as 
such. 

'  People  frequently  are  called  illogical  when  they  are  only 
ignorant.  They  are  incapable  of  reasoning  on  a  certain 
subject  because  their  fund  of  associations  is  too  small. 
They  may  do  better  somewhere  else.  They  may  also  lack 
the  kind  of  memory  type  that  aids  in  specialized  pursuits 
of  knowledge.  It  is  well  known  that  not  all  are  equally 
adepts  in  the  same  field.  We  differ,  but  need  not  be 
dunces  because  we  fail  in  one  direction.  According  to  our 
powers  of  visualization  our  associations  may  promote  in- 
ventiveness or  stifle  it.  Some  are  the  prey  of  their  as- 
sociations which  make  them  roam  aimlessly  without  focus- 
ing on  a  point.  Others  gain  by  their  memory  and  culti- 
vate a  habit  of  thought,  of  fruitful  thinking.  This  is 
really  possible,  though  not  often  practiced. 

Sciences  also  grow.  Sciences  shift  their  boundary  lines 
and  the  centers  of  emphasis  which  from  period  to  period 
characterize  their  inquiries.  They  start  out  with  well  de- 
fined lines  for  subject  matter  and  scope,  but  eventually 
feel  less  sure  about  the  divisions.  Chemistry  and  physics 
thus  have  points  in  common,  where  workers  meet  and  find 
problems  overlapping.  Biology  is  no  longer  considered 
to  be  worlds  apart  from  psychology,  and  the  social  sci- 
ences have  always  been  at  odds  over  the  precise  demar- 
cation of  their  borders. 

The  correlations  grow,  and  the  factors  in  each  correla- 


INTEPRETATION  OF  HISTORY  81 

tion  increase.  The  tendency  is  commonly  toward  further 
reduction  of  apparent  irreducibles.  We  are  driven  from 
one  ultimate  to  another.  We  divide  more  minutely  and 
distinguish  things  by  finer  lines.  Physics  for  instance 
adds  the  corpuscle  to  the  atom  and  makes  gravity  a  func- 
tion of  motion.  Chemistry  no  longer  reckons  with  atoms 
and  molecules  merely.  It  recognizes  in  addition  isomer- 
ism,  and  wonders  about  the  relation  of  the  elements,  the 
transmutation  of  matter  being  an  observed  fact.  New 
elements  in  a  narrow  sense,  and  new  constituents  of  a  cor- 
relation in  a  wider  sense  have  crept  into  the  chemist's 
range  of  vision. 

What  was  once  held  to  be  the  make-up  of  a  good  soil 
now  seems  like  an  inadequate  analysis.  We  consider  much 
more  than  the  ratio  in  which  chemical  elements  are  com- 
bined, and  the  ratio  in  which  such  compounds  appear  in 
the  soil.  We  figure  on  many  other  things  before  pro- 
nouncing on  the  worth  of  it.  Similarly  the  biologist  has 
gone  from  one  reduction  to  another.  The  cell  has 
ceased  to  be  a  homogeneous  unit.  We  now  regard  it  as  a 
highly  elaborate  mechanism  for  bodily  functions  or  for 
reproduction.  We  have  gone  from  plasm  to  nucleus,  and 
from  nucleus  to,  say,  chromatin,  and  from  that  to  chro- 
mosomes, and  thence  to  determinants  in  the  chromosomes 
which  we  think  are  the  bearers  of  heredity.  An  indeter- 
minate number  of  factors  is  said  to  be  lodged  in  the  chro- 
mosomes, the  combination  and  placements  of  which  vary, 
and  lead  to  varying  results  in  the  individual.  Psychology 
no  longer  speaks  of  "  faculties,"  as  if  they  were  entities 
functioning  in  separate  compartments.  Consciousness  is 
too  complex  a  thing  for  that.  The  percept  is  recognized 
as  a  joint  effect  of  innumerable  sensations  present  di- 
rectly or  by  recall.  It  is  like  a  mosaic  that  for  all  its 
variegation  and  numberless  bits  presents  a  unified  whole, 


82  THE  LIMITS  OF  SOCIALISM 

an  agreeable  picture  and  a  plan  adaptable  to  definite  ends. 

And  so  with  most  sciences.  The  substitution  by  the 
economist  of  the  law  of  the  proportionality  of  factors  for 
the  Ricardian  notion  of  diminishing  returns  is  a  further 
instance  of  growth  in  factors  and  correlations.  There 
is  no  need  for  expatiating  on  a  familiar  fact.  Every- 
where the  sense  of  simplicity  in  correlations  is  lost.  We 
see  a  greater  number  of  elements,  a  larger  number  of 
variables  whose  measurement  becomes  increasingly  diffi- 
cult. The  impression  of  preciseness  and  absolute  regu- 
larity is  lost  in  proportion  as  we  see  and  know  more. 
Science  is  not  as  cocksure  and  dogmatic  as  it  used  to  be. 
"  The  progress  of  science,"  as  one  philosopher  puts  it, 
"  is  a  proces-s  of  successive  approximations,  in  which  new 
and  more  precise,  more  probable  and  more  extended  in- 
ductions result  from  partially  verified  deductions,  and 
from  those  contradictions  that  correct  the  implicit  hy- 
potheses." 9 

That  is  the  true  state  of  affairs.  Science  approximates 
and  revises.  It  must  periodically  face  discrepancies  and 
contradictions.  Doubt  alternates  with  belief.  Doubt  is 
a  feeling  resulting  from  a  conflict  of  ideas,  of  associations. 
Any  one  who  has  tried  to  solve  a  problem  in  the  abstract, 
or  to  overcome  an  unexpected  practical  obstacle,  knows 
what  misery  accompanies  a  clash  of  trains  of  reasoning, 
each  good  in  itself,  but  in  discord  with  others.  When 
such  memory  associations  come  to  blows,  as  it  were,  the 
mind  suffers  as  a  whole.  It  means  misery  and  sleepless 
nights,  perhaps  loss  of  appetite  and  incapacity  for  routine 
actions.  Doubt  is  the  opposite  of  belief  which  is  the  fruit 
of  habituations  developed  at  leisure. 

Science,  then,  has  limitations  which  bear  on  all  matters 
of  study  and  are  of  significance  even  for  the  socialist  who 
»  Enriques,  F.,  "  Problems  of  Science,"  p.  166. 


INTEPRETATION  OF  HISTORY  83 

would  reform  the  world.  Science  is  not  the  simple  de- 
vice for  ascertaining  irrefutable  truths  that  socialism  has 
often  pictured  it  to  be.  It  is  a  case  of  change  in  venue. 
Laws  are  mutable,  though  of  many  things  we  all 
obtain  like  impressions.  Mill's  canons  erred  in  promising 
science  more  than  it  has  accomplished.  In  particular  is 
the  Canon  of  Difference  no  more  infallible  than  any  of 
the  others,  for  the  missing  link  or  cause  may  be  much 
more  than  a  single  agent.  Its  reduction  may  be  impend- 
ing. 

What  we  are  sure  of,  so  far  as  modern  psychological 
evidence  is  concerned,  is  the  existence  of  one  method  of 
reasoning  employed  by  all  sciences.  The  number  of  sci- 
ences may  be  increased  indefinitely  according  to  our  con- 
ception of  correlations  of  events,  but  they  all  resort  to  the 
same  mode  of  discovery  and  of  generalization.  Deduc- 
tion and  induction,  for  the  same  reason,  are  not  two  dis- 
tinct methods,  but  two  aspects  of  one  single  process  of 
reasoning.  In  the  syllogism  the  conclusion  follows  from 
the  premises  because  we  have  always  known  a  part  of  a 
thing  to  be  smaller  than  the  whole.  This  axiom  decides 
in  the  end.  But  the  rules  of  distribution  result  from  the 
principles  of  association  that  are  used  in  collocating  two 
premises  so  as  to  make  their  bearing  upon  the  conclusion 
plain.  Induction  underlies  the  construction  of  the  syllo- 
gism, though  after  the  premises  are  laid  down  a  purely 
deductive  act  takes  place.  But  it  remains  true,  as  was 
stated  over  a  century  ago,  that  the  syllogism  in  itself  can- 
not extend  knowledge,  because  it  assumes  what  at  the  mo- 
ment is  not  verified  or  perhaps  cannot  be  verified. 

§  3.  The  Meaning  of  Causation —  These  things  being 
so  the  meaning  of  cause  and  effect  also  becomes  clear.  In 
the  words  of  J.  S.  Mill :  Cause  is  "  The  sum  total  of  con- 
ditions, positive  and  negative,  taken  together;  the  whole 


84  THE  LIMITS  OF  SOCIALISM 

of  the  contingencies  of  every  description,  which  being 
realized  the  consequent  invariably  follows."  10  And  to 
quote  from  two  later  writers :  "  There  is  no  particular 
difference  between  knowledge  of  causes,  and  our  general 
knowledge  of  the  combinations,  or  succession  of  combina- 
tions, in  which  the  phenomena  of  nature  are  presented  to 
us,  or  found  to  occur  in  experimental  inquiry."  J1 
"  Things  are  not  either  independent,  or  causative.  All 
classes  of  phenomena  are  linked  together,  and  the  prob- 
lem in  each  case  is  how  close  is  the  degree  of  association."  12 

That  is  to  say,  every  factor  in  a  given  situation  —  no 
matter  how  far  we  may  go  in  our  choice  of  factors,  is 
either  cause  or  effect  according  to  viewpoint  and  need. 
Objectively  they  function  in  this  respect  all  in  the  same 
way,  but  our  subjective  choice  leads  to  the  designation  of 
some  'particular  facts  as  causes.  All  sequences  and  co- 
existences consist  necessarily  of  causal  relations,  no  matter 
how  obscure.  Even  the  random  arrangement  of  furniture 
in  a  room  represents  cause  and  effect  if  one  wishes  to 
speak  accurately.  Any  set  of  facts  is  cause  and  effect,  of 
which  some  facts  become  causes  in  a  narrow  sense. 

We  select  particulars  on  the  principle  of  attention  al- 
ready discussed.  Stimuli  interest  us  in  different  ways. 
We  react  not  in  like  ways  to  things.  Our  life  is  a  process 
of  adjustmet  to  physical  and  economic  environment,  such 
that  some  elements  in  a  situation  will  seem  vital  while 
others  are  negligible.  Causation  is  a  selective  act.  To 
ascribe  cause  to  something  is  to  give  it  a  special  value  for 
particular  purposes.  For  instance,  to  say  that  cold 
freezes  water  into  ice  is  a  way  of  calling  attention  to  a 

10 Mill,  J.  S.,  "Logic,"  Book  III,  Chapter  5,  No.  3.  Similarly 
also  Venn,  J.,  in  his  "  Empirical  Logic,"  p.  67. 

11  Jevons,  W.  S.,  "  Principles  of  Science,"  Book  II,  Chapter  1. 

12  Pearson,  K.,  "Grammar  of  Science,"  Edit.  1911,  Volume  1,  p. 
166.     See  also  p.  177. 


INTEPRETATION  OF  HISTORY  85 

factor  influencing  our  behavior  at  the  time.  Many  things 
go  into  the  situation :  The  location  of  water,  the  atmos- 
pheric conditions,  the  qualities  of  matter  in  general  and 
of  water  in  particular,  such  as  expansion,  weight,  trans- 
lucency,  etc.,  etc.  But  one  group  in  the  ensemble  known 
as  cold  gets  the  credit  or  blame  for  the  entire  complex. 
Except  by  reference  to  will  and  will-to-live  our  designa- 
tion of  cause  and  effect  must  appear  quite  arbitrary. 

Nietzsche,  the  German  prophet  of  a  revaluation  of 
values,  remarks  in  his  "  Will  to  Power  "  that  "  the  so- 
called  instinct  of  causality  is  nothing  more  than  the  fear 
of  the  unfamiliar,  and  the  attempt  at  finding  something 
in  it  which  is  already  known."  That  is  a  pithy  way  of 
stating  one  of  the  principles  governing  our  designation  of 
cause.  We  see  ourselves  as  agents  and  call  the  facts 
about  us  frequently  the  effects  of  our  action,  we  being  the 
cause.  The  Ego  is  a  unit.  Its  expressions  are  results  of 
a  will.  We  are  cause  and  bring  about  effects.  And  just 
as  people  from  time  immemorial  have  personalized  unex- 
plained facts,  making  out  of  them  gods  in  human  shape  or 
powers  of  human  capacity  magnified  many  times,  so  by 
reasoning  from  analogy  we  attribute  a  causative  function 
to  other  live  or  moving  factors  in  a  situation.  Fear 
prompts  us,  and  introspection  guides  us  in  this  step.  Ani- 
mals are  pictured  as  agents,  and  inanimate  things  become 
causes  when  made  conspicuous  in  some  way. 

A  second  principle  in  our  choice  of  cause,  then,  is  mo- 
tion. In  the  midst  of  immobile  things  the  moving  appear 
more  commonly  as  cause,  if  no  other  principle  interferes. 
The  falling  of  a  leaf  from  a  tree,  for  instance,  is  said  to 
result  from  a  gust  of  wind.  The  wind  was  felt  or  heard. 
The  rotting  of  the  stem  of  the  leaf,  the  extra  weight  of 
it  due  to  an  excrescence  on  the  underside,  the  condition  of 

is  "The  Will  to  Power,  Aphorism,"  No.  551. 


86  THE  LIMITS  OF  SOCIALISM 

the  twig  whence  it  came,  the  law  of  gravitation  —  these 
and  more  facts  were  overlooked  or  taken  for  granted. 
The  idea  of  force  impelled  us  to  hold  the  breeze  re- 
sponsible. Again.  We  say  motion  causes  friction,  not 
friction  motion.  This  seems  reasonable;  but  why?  The 
two  form  a  coexistence.  We  cannot  set  the  moment  at 
which  friction  ensues  after  motion  has  commenced.  The 
two  coincide  absolutely.  But  motion  is  more  apparent 
than  friction,  and  back  of  motion  is  noticed,  or  under- 
stood to  act,  an  agent  who  really  is  the  causative  fact 
we  allude  to. 

4  Often,  however,  and  in  the  third  place,  we  distinguish 
etween  things  controllable  by  man  and  those  not  so  con- 
trollable. The  former  are  then  the  causes,  and  the  latter 
the  effects,  or  the  subliminal  facts  of  no  consequence. 
What  cannot  be  changed  we  do  not  attack  in  a  plan  of 
action.  We  divide  the  world  —  say  for  purposes  of  re- 
form —  into  variables  and  constants,  thinking  of  the  lat- 
ter as  facts  unalterable.  Thus  the  law  of  gravitation  is 
taken  for  granted.  We  expect  men  to  protect  themselves 
against  it  in  certain  situations.  We  provide  means  of 
support  for  objects.  Buildings  and  chairs  are  devices  for 
utilizing  or  offsetting  the  general  law.  We  do  not  blame 
the  law  when  something  falls.  We  ask  people  to  be  more 
careful  and  hold  on  to  things,  or  to  build  better  founda- 
tions. 

Or  suppose  a  man  is  found  destitute  of  the  means  of 
livelihood.  We  can  assign  this  to  a  hundred  facts,  but 
probably  will  not  think  of  the  man's  stupidity  first.  Or, 
if  we  do,  we  proceed  to  emphasize  another  fact  as  cause. 
The  pauper  himself  may  complain  of  unemployment  or 
illness  in  the  family,  or  of  an  accident,  and  what  not. 
Or  we  find  him  indolent,  inattentive,  intemperate,  etc. 
Or  we  speak  of  hard  times,  of  bad  politics,  of  unfavorable 


INTEPRETATION  OF  HISTORY  87 

weather  for  the  sort  of  work  the  poor  man  wanted.  The 
factors  we  can  control  or  believe  we  can  change  become 
cause ;  the  rest  is  ignored. 

In  the  fourth  place  special  purposes  may  guide  us.14 
We  speak  of  prejudices  and  axes  to  grind,  of  malice  and 
ulterior  motives,  and  like  things  that  color  our  judgment 
and  decide  our  choice  of  cause.  Or  it  is  the  event  nearest 
in  time  or  place  that  looms  up  as  cause,  as  when  a  crowd 
gathers  in  a  street  and  I  notice  a  boy  looking  for  a  coin. 
I  make  him  the  starting  point  of  my  location  of  cause  and 
effect  because  I  saw  him  and  watched  the  number  of  on- 
lookers grow  after  his  loss.  I  do  not  ask  why  he  dropped 
the  coin,  whether  he  was  day-dreaming  or  had  a  nervous  fit, 
or  what  led  to  day-dreaming.  And  so  on.  The  nearest 
concrete  and  active  factor  becomes  the  cause.  The  mur- 
derer is  arraigned  and  condemned  partly  for  this  reason. 
We  either  disdain  searching  into  his  history  or  that  of 
the  victim,  in  order  to  extend  the  chain  of  factors,  or  we 
take  refuge  in  a  postulate  of  freewill  and  then  pronounce 
judgment. 

We  cannot  trace  all  the  intervening  links  in  a  lengthy 
chain  of  facts  constituting  a  correlation  regularly  recur- 
ring. When  a  cow  gives  birth  to  a  calf  we  ascribe  the 
flow  of  milk  to  that  event.  We  do  not  go  back  to  the 
facts  of  fertilization  that  would  logically  form  a  more 
correct  starting  point  for  the  whole  correlation.  Or  say 
a  war  breaks  out.  Will  not  the  cause  be  the  occasion 
that  historians  distinguish  from  the  "  underlying  "  causes  ? 
And  are  not  the  remote  "  causes  "  certain  facts  preceding 
the  declaration  of  war?  Is  it  not  plain  that  only  a  few 

i*  What  is  known  as  the  pragmatic  movement  in  philosophy  has 
developed  this  point  into  a  system  of  thought,  of  which  Schiller, 
F.  C.  S.,  is  a  typical  representative.  See  this  writer's  "  Formal 
Logic,"  pp.  277  &  283.  Likewise:  Enriques,  F.,  "Problems  of 
Science,"  p.  142;  James  W.,  "  Pragmatism." 


88  THE  LIMITS  OF  SOCIALISM 

out  of  the  whole  number  of  facts  in  a  situation  are  rather 
arbitrarily  selected  as  the  cause? 

The  most  obvious  and  nearest  incidents  impress  us  as 
causes,  but  in  reality  the  situation  is  not  so  simple. 
Especially  in  the  organic  and  social  sciences  the  number 
of  relevant  factors  is  legion.  We  may  pounce  on  par- 
ticulars, but  no  proof  for  such  cause  and  effect  will  be 
forthcoming.  For  not  only  is  reproduction  of  the  situa- 
tion technically  impossible,  but  what  is  more,  we  shall  not 
all  classify  cause  and  effect  in  the  same  way.  It  is  often 
a  case  of  weighing  trained  knowledge  against  amateur 
views,  with  the  understanding  that  in  the  end  either  may 
feel  right.  Where  no  direct  appeal  to  the  senses  whose 
reactions  we  all  share  in  common  is  possible,  the  rule  of 
public  opinion  or  of  reputed  authority  begins. 

§  4.  Causation  and  Economic  History. —  If,  now,  we 
apply  this  analysis  of  correlation  and  causation  to  the 
Marxian  statement  of  the  economic  interpretation  of  his- 
tory, or  to  the  question  of  the  relation  between  economic 
and  non-economic  facts,  we  shall  see  that  causal  connec- 
tions such  as  socialism  has  commonly  asserted  do  not 
exist.  The  economic  world  embodies  stimuli  that  act 
upon  man,  but  so  do  many  non-economic  facts.  And  man 
himself  is  needed  in  the  situation  to  give  contents  to  both. 
The  economic  facts  are  part  of  our  thinking  and  feeling. 
If  any  one  fact  is  a  cause  in  such  an  ensemble  it  should  be 
man  whose  mind  is  a  unit,  and  whose  facts  of  conscious- 
ness are  all  inextricably  interwoven. 

From  the  psychological  standpoint,  that  is  to  say,  the 
Marxian  superstructure  of  law  and  philosophy  is  merely 
a  set  of  interests  somewhat  farther  from  the  primitive 
man,  from  the  center  of  attention  and  striving,  than  the 
acts  of  production  and  exchange.  Man's  needs  are 
graded  because  of  the  facts  of  his  evolution  and  physical 


INTEPRETATION  OF  HISTORY  89 

constitution.  Some  of  our  reactions,  correspondingly, 
will  suit  the  immediate  needs  of  survival  or  social  devel- 
opments;  others  may  persist  even  when  primary  needs 
catering  to  survival  have  changed. 

To  illustrate.  It  should  not  be  difficult  to  trace  a  con- 
nection between  prohibition  and  the  value  of  sobriety  in 
modern  production,  or  between  the  sanctioning  of  fe'male 
modern  rights  and  women's  industrial  activities,  or  be- 
tween our  present  praise  of  thrift  and  the  debt  of  the 
United  States  or  our  fear  of  propertyless  masses.  Such 
"  ethical "  facts  may  be  thought  to  rest  directly  on  eco- 
nomic facts,  though  the  causal  chain  runs  both  ways. 
But,  on  the  other  hand,  the  economics  of  the  ancient 
Hindoos  could  only  faintly  be  reconstructed  from  the 
Vedas.  Our  idea  of  Chinese  economic  environment  can- 
not be  properly  derived  from  a  study  of  their  voluminous 
literary  works.  The  art  of  all  ages  shows  considerable 
uniformity  of  ideas  and  technique,  and  but  little  pe- 
culiarity indicative  of  particular  modes  of  living.  Simi- 
larly with  scientific  speculation,  philosophy,  and  con- 
cepts of  government  or  morality.  The  principles  of 
sociation  which  sociology  and  economics  study  rest  on 
facts  of  human  nature,  and  these  are  so  constant  that 
certain  rules  of  conduct  are  valid  for  all  times,  however 
variable  their  form  and  economic  expression. 

To  speak  of  interaction  of  economic  and  non-economic 
facts  is  chiefly  to  use  a  figure  of  speech,  for  what  is  in- 
teraction? If  I  see  a  cat  and  dog  fighting  I  can  follow  the 
movements  of  each  and  see  each  acting  upon  the  other, 
with  results  visible  perhaps  to  the  eye.  That  is  interac- 
tion in  the  real  sense  of  the  word.  But  in  social  affairs 
the  relation  is  more  nearly  one  of  force  according  to  the 
physicist's  use  of  the  term.  The  physicist  can  describe 
force  only  as  a  product  of  two  factors ;  or,  to  be  quite  ac- 


90  THE  LIMITS  OF  SOCIALISM 

curate,  force  to  him  is  simply  a  ratio,  a  function  of  vari- 
ables. Force  refers  to  couples  never  reducible  to  entities. 
So  it  is  with  economic  and  non-economic  aspects.  We 
have  never  seen  them  apart.  We  can  only  say,  as  the 
phychologist  sometimes  says,  that  two  sets  of  events  move 
in  unison,  parallel  to  each  other.  Whether  interaction  in 
the  strict  sense  of  the  term  takes  place  he  may  be  loth  to 
decide.  He  pleads  ignorance  and  goes  ahead  confident  of 
results  from  his  labors.  So  with  the  student  of  social 
events.  In  speaking  of  their  interactions  he  really  has 
in  mind  only  coexistences  which,  in  any  given  correlation, 
appear  to  him  as  an  organic  whole.  He  cannot  reduce  it 
to  independent  units,  though  he  may  picture  the  parts  as 
functioning  like  the  parts,  say,  of  the  human  body.  The 
picture  helps  us  to  understand,  to  get  meaning  out  of  our 
words. 

But  the  relation  of  economic  to  so-called  non-economic 
events  may  be  still  better  elucidated  by  modern  psychol- 
ogy, whose  conclusions  are  important  for  all  phases  of 
sociological  analysis. 

Three  fundamental  facts  need  to  be  remembered  in  this 
connection.  The  first  is  that  all  objects,  not  merely  the 
economic,  may  act  as  stimuli.  The  second  is  the  differ- 
ences in  reactions  by  different  men  upon  like  stimuli,  or 
conversely  the  fact  that  different  men  react  upon  differ- 
ent things. 

Our  environment  may  be  defined  as  the  things  we  con- 
sciously or  unconsciously  react  upon.  It  is  what  we  re- 
spond to  in  a  physical  or  mental  way  that  constitutes  part 
of  our  life,  not  everything  about  us  in  space.  Shake- 
speare, thus,  becomes  part  of  my  experience,  while  people 
still  alive,  but  many  miles  away  and  in  no  wise  brought  in 
touch  with  me  personally  or  indirectly,  are  strangers  that 
do  not  figure  in  my  environment.  Again,  since  our  life 


INTEPRETATION  OF  HISTORY  91 

is  a  cycle  of  growth  and  decay,  it  is  natural  that  at  dif- 
ferent ages  different  things  should  enter  into  our  psychic 
world.  The  boy  does  not  see  what  interests  an  adult,  but 
he  observes  much  else  that  grown-ups  overlook.  Sex  and 
age  and  profession  and  congenital  proclivities  aVe  deter- 
minants of  environment  psychologically  viewed. 

But  from  this  follows  the  individuality  of  thought  and 
feeling,  and  more  especially  the  independence  of  both  from 
the  external  world.  Thirdly,  then,  the  effect  of  memory 
and  associations  stands  in  no  measurable  relation  to  the 
objects  about  us,  and  furthermore,  centrally  aroused  sen- 
sations become  more  and  more  important  with  age  and 
historical  development  of  races,  so  that  correlations  be- 
tween economic  data  and  mentality  are  altogether  inde- 
terminate. One  cannot  infer  from  external  facts  what 
precise  value  our  thought  will  take.  Inventions,  e.  g., 
start  commonly  with  economic  facts,  but  their  direction 
depends  on  memory  associations  which  in  their  turn  are 
governed  by  predisposition,  by  the  laws  governing  per- 
ception, immediate  purpose,  etc.,  etc.  As  the  psycholo- 
gist expresses  it :  "  It  is  seldom  that  an  act  or  thought  is 
controlled  merely  by  a  single  stimulus  or  even  by  the 
stimuli  that  are  being  received  at  the  moment  of  action. 
The  laws  of  facilitation  and  inhibition  of  one  set  of  cor- 
tical activities  by  others  that  are  going  on  simultaneously 
in  other  paths  and  in  other  areas  are  needed  if  we  are  to 
obtain  any  accurate  picture  of  cortical  action,"  15  and 
that  means  also  of  concepts  in  general.  Attitude  is  a 
great  deal.  Whether  the  picture  in  the  book  looks  to  me 
like  a  rabbit  or  like  a  duck's  bill  depends  on  angle  of  vision 
and  on  subconscious  activities  within  me.  The  thought  of 
a  seismograph  on  seeing  a  crisscross  of  lines  may  only  oc- 
cur to  a  person  after  other  facts  have  suggested  earth- 
is  Pillsbury,  W.  B.,  "Fundamentals  of  Psychology,"  p.  91. 


92  THE  LIMITS  OF  SOCIALISM 

quakes,  as  an  actual  experience  has  shown.  My  trend  of 
reasoning  and  the  direction  of  discovering  vary  with  pre- 
vious training  and  general  interests.  This  is  the  over- 
whelming evidence  of  the  history  of  science.  Thoughts 
have  their  own  history,  and  their  economic  ef- 
fects are  consequents  in  point  of  time  rather  than 
coexistences,  though  the  historian  expands  his  con- 
cept of  simultaneity  and  thus  obtains  a  comparison 
of  economic  and  non-economic  events.  "  The  movement 
of  thought  might  be  regarded  as  an  interaction  of  pur- 
poses and  environment,  each  of  which  in  some  measure 
modifies  the  other.  At  least  no  interpretation  and  no 
improvement  can  be  considered  as  a  discrete  event.  It 
has  its  meaning  in,  and  its  appearance  and  development 
is  controlled  by,  wider  mental  and  physical  contexts. 
These  serve  to  determine  the  nature  of  the  appreciation 
and  to  give  the  desire  that  leads  to  the  particular  im- 
provements. In  this  way  the  progress  of  thought  is  one 
continuous  operation.  No  part  can  be  understood  unless 
it  is  considered  with  the  whole."  16 

The  independence  of  thought  is  real.  Economic  facts 
do  not  make  or  mold  the  non-economic,  nor  must  a  history 
of  religion  or  of  jurisprudence  be  referred  to  particular 
and  corresponding  economic  epochs.  Such  a  cross  refer- 
ence may  form  a  part  of  an  historical  study,  but  cannot 
be  essential  except  in  a  few  cases.  The  study  of  legis- 
lation regulative  of  economic  relations,  including  property 
relations,  is  an  economic  subject,  though  legislation  is  a 
political  function.  Politics  is  the  application  of  the  prin- 
ciples of  sociology  and  economics  toward  social  better- 
ment. In  this  sense  jurisprudence  and  law  are  best  un- 
derstood in  the  light  of  economic  data,  but  this  is  no  in- 
stance of  the  economic  man  making  our  non-economic  his- 
,  W.  B.,  "Psychology  of  Reasoning,"  p.  286. 


INTEPRETATION  OF  HISTORY  93 

tory.  It  shows  the  possibility  merely  of  studying  eco- 
nomic relations  from  two  view-points,  the  individual  and 
the  collective. 

§  5.  The  Law  of  Maladjustment — The  Marxian  in- 
terpretation of  history  takes  due  notice  of  a  conflict  be- 
tween individuals  and  ideas,  and  makes  it  the  basis  for  a 
theory  of  revolution  and  progress  which  is  more  in  accord 
with  scientific  thought  than  his  subordination  of  the  in- 
tellectual and  moral  force  to  the  economic.  He  an- 
nounced the  impending  doom  of  capitalism  on  two  grounds, 
first  because  systematic  exploitation  would  ultimately 
consolidate  all  property  into  the  hands  of  a  few  who, 
while  having  no  competitors  to  fear,  would  be  faced  by 
a  hungry  proletariat  that  would  claim  what  was  right- 
fully theirs,  and  secondly  because  economic  and  non-eco- 
nomic achievements~and  norms  tend  to  overlap  at  certain 
times,  the  maladjustment  growing  until  a  break  was  in- 
evitable, which  would  restore  an  adjustment  between  the 
two  fields  of  thought  and  action.  The  exact  manner  in 
which  this  periodic  maladjustment  is  brought  about  does 
not  appear  to  have  been  described  anywhere,  but  one  must 
infer  that  differences  arising  between  new  ideas  and  old 
traditions  were  meant. 

In  a  sociological  sense  conflicts  are  ordinarily  of  two 
kinds.  Men  fight  each  other  in  the  peaceful  way  that 
modern  economics  exemplifies  so  strikingly,  or  they  are 
torn  by  inner  conflicts.  We  either  have  to  contend  with 
others,  or  with  ourselves.  The  underlying  reasons  are 
often  the  same  for  both  cases,  but  the  feeling  created  is 
far  from  the  same.  We  cannot  hate  ourselves,  though 
we  sometimes  think  so.  On  the  other  hand  it  is  hard  to 
forgive  our  enemies,  though  there  is  much  to  excuse  them. 
Misery  has  these  aspects.  It  is  objective  when  disease  and 
poverty  stalk  among  the  masses  and  make  their  life  a 


94  THE  LIMITS  OF  SOCIALISM 

burden.  It  is  objective  in  so  far  as  the  economic  rela- 
tions between  men  have  been  regulated  by  laws  open  to 
inspection.  It  becomes  subjective  when  we  think  of  one 
set  of  men  holding  ideas  scorned  by  a  second  set,  the  two 
quarreling  about  their  rights  and  duties.  And  it  again 
takes  a  subjective  hue  when  we  look  into  our  own  self  and 
find  doubt  and  scruples,  ideals  falsely  focussed,  practices 
incompatible  with  resolutions  made  and  cherished. 

The  law  of  progress  enunciated  by  Marx  is  a  reflex  of 
these  several  forms  of  conflict,  and  it  agrees  partly  with 
the  facts  of  correlation  and  causation  considered  a  while 
ago.  Maladjustment  does  occur  pretty  regularly.  Per- 
haps it  would  not  be  wrong  to  make  it  a  part  of  human 
history  as  much  as  reversion  is  part  of  evolution.  A  cut- 
ting back  is  no  worse,  no  more  irregular,  than  a  cutting 
ahead.  Tne  recapitulation  theory  for  that  reason  has 
been  revised  by  careful  biologists. 

Conflict  always  accompanies  control,  and  is  a  result  of 
two  sorts  of  differences  between  men,  namely  those  that 
appear  when  we  compare  them  at  an  instant  of  time,  and 
those  due  to  afferent  rates  of  reaction  and  growth  cover- 
ing a  longer  j^ej-iod. 

The  social  process  is  one  of  interaction  between  man 
and  environment.  The  environment  is  physical  and  social, 
and  for  reasons  already  suggested  it  may  at  times  be  ad- 
vantageous to  separate  social  activities  into  the  economic 
and  non-economic.  Physical  environments  exercise  a 
great  influence  over  men,  and  they  differ  from  place  to 
place.  The*  environment  is  chiefly  climate,  but  climate 
comprises  many  factors  such  as  temperature,  humidity, 
solar  radiation,  length  of  day  and  season,  wind  pressure 
and  direction,  variability  per  month  and  day,  extremes  of 
range  during  the  year,  the  combination  of  temperature 
with  humidity  and  wind  pressure,  and  so  on.  The  effect 


INTEPRETATION  OF  HISTORY  95 

of  such  variations  upon  man,  and  in  particular  upon 
labor  capacities,  has  been  carefully  studied.  That  cli- 
mate has  much  to  do  with  temperament  is  well  known. 
That  literature  and  art  no  less  than  economic  achieve- 
ments or  the  nature  of  scientific  endeavors  bear  testimony 
to  the  influence  of  climate  has  also  been  admitted  for  many 
decades.  But  it  is  a  more  recent  opinion  that  energy  and 
inventiveness  are  functions  of  climate,  and  that  the  his- 
tory of  civilizations  is  largely  one  of  climatological 
changes  now  hidden  from  view,  but  powerful  in  their 
day.17 

Climate  is  part  of  latitude  and  topography,  but  the 
latter  has  direct  bearings,  too,  on  the  development  of 
transportation  and  travel.  Facilities  for  communication 
vary  with  the  lay  of  the  land,  with  coastal  contour  and 
the  characteristics  of  river  and  lake  systems.  Mountain 
ranges  and  plateaus,  drainage  basins  and  passes,  the  slop- 
ing of  ranges  and  their  passes,  these  and  other  features 
count  in  history.  They  form  the  outer  limits,  so  to  say, 
beyond  which  human  will  dare  not  move.  What  the  earth 
provides  in  minerals  and  timber,  soil  fertility  and  water 
power,  that  is  a  maximum  man  can  seldom  ignore.  If, 
therefore,  men  live  in  greatly  different  physical  environ- 
ments their  capacities  and  wants  cannot  correspond  favor- 
ably. There  will  arise  opposing  viewpoints. 

Yet  it  has  been  to  many  thinkers  axiomatic  that  malad- 
justment is  not  a  product  of  nature  conditions,  but  in- 
stead a  social  excrescence.  Man  nmlcps  hjyn^plf  miserable: '._ 
he  is  not  made  so  by  nature.  The  trouble  ordinarily 
lies  then  in  economic  conditions,  relative  to  which  differ- 
ences in  physical  environs  and  in  human  nature  may  be 
discounted.  Men  are  congenitally  very  different  and  will 

17  See  especially  Huntington,  F.,  in  his  "  Civilization  and  Climate," 
and  his  more  recent :    "  World  Power  and  Evolution." 


96  THE  LIMITS  OF  SOCIALISM 

never  sympathize  with  each  other  on  all  points.  They  are 
bound  to  part  company  somewhere.  So  also  the  differ- 
ences of  climate  develop  their  peculiarities.  But  we  must 
assume  these  facts  and,  making  them  our  constants,  at- 
tempt to  adapt  economic  facts  and  personal  relations  to 
them.  An  offsetting  policy  would  be  always  opportune. 
If,  however,  the  economic  differences  in  wealth  and  up- 
bringing, in  aptitudes  and  daily  occupation,  in  modes  of 
living  and  social  control,  if  these  facts,  too,  separate  men, 
their  interests  may  become  irreconcilable. 

And  to  this  source  of  misunderstanding  and  friction  we 
are  bound  to  add  the  effect  of  different  rates  of  change  in 
the  several  factors,  physical,  personal,  and  economic. 

The  physical  environment  changes  but  slowly :  so  slowly 
that,  barring  earthquakes  and  floods  or  such  like,  it  ap- 
pears to  us  stagnant.  Only  the  geologist  is  interested 
in  the  imperceptible  movements  that  are  part  of  our 
earth's  record. 

But  since  men  are  so  differently  constituted  some  will 
keep  abreast  of  their  times,  and  many  will  not.  The  in- 
ventive man  who  helps  to  reconstruct  our  economic 
mechanism  is,  along  some  lines,  likely  to  adjust  himself 
to  each  moment,  but  to  the  average  man  the  trend  of 
economic  affairs  is  only  a  means  to  greater  creature  com- 
forts, and  beyond  that  a  source  of  annoyances,  his  habits 
being  jolted  by  new  demands  arising  from  he  wonders 
where.  However,  even  the  innovator,  the  man  chiefly  in- 
strumental in  translating  ideas  into  a  concrete  world  of 
goods,  will  retain  many  habits  as  of  old,  even  when  they 
are  affected  by  his  own  scientific  contributions.  Man  is 
a  unit.  Yes.  But  his  mental  associations  need  not 
therefore  all  move  on  one  level.  A  master  mind  in  science 
or  merchandising  is  often  a  mediocre  in  his  appraisal  of 
non-professional  facts.  He  has  for  the  first  score  of 


INTEPRETATION  OF  HISTORY  97 

years  been  under  guidance  that  impregnated  him  with 
ideas  not  all  adaptable  to  the  new  conditions  which  he 
himself  assists  in  creating.  For  one  thing  some  memory 
associations  antedate  our  creative  life,  and  that  has  pro- 
found significance  for  the  facts  of  maladjustment.  And 
for  another  thing,  even  during  the  creative  period  of  life 
men  remain  conservative  in  many  respects.  Ideas  move 
in  groups.  Many  groups  will  not  be  directly  involved  in 
the  process  of  thought  filling  our  professional  life.  Oth- 
ers will  be  gradually  revised,  and  some  ideals  as  well  as 
habits  will  not  budge  a  bit.  Thus  each  man,  the  most 
richly  gifted  not  excluded,  may  be  pictured  as  keeping 
only  here  and  there  pace  with  his  outer  world.  Ideas 
radiate  changes  in  many  directions,  but  within  us  the 
change  moves  more  nearly  in  certain  specialized  fields. 
The  realignment  of  stimuli  from  the  outside,  though 
forced  by  our  innovations,  calls  for  a  wider  range  of  adap- 
tation in  response  and  habits  of  thinking  than  we  are 
capable  of.  The  result  is  a  testing  within,  which  may 
eventually  spell  skepticism  and  revolt,  misery  objective  no 
less  than  subjective.  It  is  again  a  matter  of  difference 
in  degree  as  between  different  social  groups.  None  are 
altogether  exempt  from  the  ordeal. 

But  furthermore,  the  lines  of  cleavage  socially  are  ac- 
centuated by  the  power  of  custom.  Custom  is  habit 
viewed  socially.  Habit  dies  with  the  individual :  custom 
does  not.  Custom  is  opinion  preserved  and  transmitted 
from  generation  to  generation,  the  modifications  being; 
hardly  noticeable,  though  marked  at  last.  If  all  men  were 
equally  endowed  with  intelligence  and  energy  custom  would 
be  less  important  and  conviction  more.  But  as  things  are, 
the  norms  of  a  minority  are  sure  to  impress  the  majority, 
and  Personality  survives  person. 

Habits  are  standardized.     Ideals  are  habits  of  thought 


98  THE  LIMITS  OF  SOCIALISM 

on  certain  matters.  Ideals  are  norms  governing  our  con- 
duct, or  tending  to  do  so  on  the  average.  These  norms 
become  frequently  traditions  handed  from  father  to  son, 
from  one  age  to  another.  They  have  been  called  sanctions 
because  only  by  popular  sanction  can  these  practices  in 
thought  and  action  exercise  such  control  over  our  lives. 
Many  of  these  norms  are  institutionalized  in  church  and 
school,  family  and  government,  or  in  business  etiquette. 
They  envelop  us  from  the  very  beginning  and  do  not 
leave  us  until  death.  They  gather  momentum  which  tri- 
umphs over  reason.  That  is  to  say,  just  as  our  strictly 
personal  views  and  habits  are  more  or  less  mobile,  some 
making  for  changes  in  our  environment  and  some  failing 
to  move  in  unison  with  them,  so  social  heredity  may  make 
a  fetich  of  norms  after  they  have  ceased  to  correspond 
closely  with  the  world  about  us.  Or,  to  state  the  situa- 
tion differently:  Some  of  our  views  and  habits  change 
more  slowly  than  others,  not  only  by  nature,  but  because 
of  the  daily  impress  of  authority  from  without.  The 
power  of  parental  control  should  be  distinguished  from 
the  control  of  law  or  government,  and  the  joint  effect  of 
all  must  be  compared  with  the  associational  process  con- 
stituting our  mental  life,  which  for  some  is  so  productive 
of  tangible  economic  results,  while  to  others  it  means 
little  —  either  in  creativeness  or  in  feelings  of  conflict. 

If  then  we  speak  of  being  out  of  harmony  with  our 
environment  we  mean  these  three  things,  first  that  our 
mental  development  has  progressed  unevenly  in  different 
directions ;  secondly  that  some  of  us  have  grown  while 
others  have  stagnated,  content  to  accept  matters  as  they 
are,  regardless  of  the  demands  of  the  more  progressive; 
and  third,  that  our  fellowmen  are  to  us  an  objective  real 
influence  in  different  degrees. 

As    to    this    social    environment.     In    one    sense    the 


INTEPRETATION  OF  HISTORY  99 

phrase  "  social  environment  "  is  inapt,  for  society  is  a 
unit,  and  from  the  collectivist  standpoint  of  the  sociolo- 
gist a  social  environment  can  only  mean  society  con- 
fronted with  nature.  But  that  is  not  the  sense  in  which 
the  phrase  is  commonly  used.  So  it  must  express  an  indi- 
vidual standpoint.  The  individual  calls  all  his  fellowmen 
his  environment.  But  is  this  a  correct  attitude?  In  so 
far  as  all  individuals  are  substantially  alike,  one  cannot 
make  or  mar  the  other.  Nature  conditions  set  real  limits 
to  human  striving,  but  my  average  compatriot  cannot. 
Or,  at  any  rate,  if  he  is  my  environment  so  am  I  his. 
Hence  the  term  has  a  dual  aspect  which  may  easily  be  for- 
gotten. 

Nevertheless  does  it  refer  to  something  very  definite  in 
another  sense.  For  since  men  are  not  all  equal,  since 
some  exercise  lasting  influence  over  others  it  follows  that 
much  of  the  average  man's  environment  is  the  superior 
man  of  talent  or  genius.  To  those  supermen  the  social 
environment  is,  in  its  living  members,  a  minor  factor,  al- 
beit not  a  negligible  one.  But  to  their  mediocre  contem- 
poraries they  themselves  are  major  factors,  a  social  en- 
vironment in  a  much  more  serious  sense.  The  great  men 
originate  and  propagate  ideas.  They  prescribe  rules  of 
conduct,  even  if  the  observance  thereof  rests  mainly  with 
the  imitators.  The  supermen  alter  conditions  and  often 
defy  the  sanctions.  They  induce  the  less  gifted  to  ques- 
tion the  traditional,  perhaps  to  make  sport  of  long  hal- 
lowed customs.  Thus  the  course  of  maladjustment  be- 
tween social  groups  is  hastened,  and  finally  a  movement 
becomes  visible  whose  aim  is  confessedly  the  assault  upon 
social  heritage.  Something  like  this  effect  is  produced  by 
migrations.  If  many  millions  move  from  one  physical  and 
economic  environment  into  a  very  different,  they  are  likely 
to  receive  a  shock,  because  their  habits  and  ideals  cannot 


100  THE  LIMITS  OF  SOCIALISM 

migrate  in  the  same  way.  They  are  firmly  lodged  and 
offer  a  wall  of  resistance  to  whatever  demands  a  new 
outer  world  makes.  The  result  is  disconcerting,  and  for 
some  individuals  may  spell  disaster.  The  Scotchman's 
thrift  may  look  like  niggardliness  when  he  migrates  from 
his  inhospitable  heath  to  the  fertile  plains  of  America. 
The  European  who  is  taught  to  flatter  and  fawn  if  he 
would  succeed,  finds  his  habits  unprofitable  in  a  land  where 
mobility  of  rank  and  power  is  no  less  understood  than  the 
mobility  of  labor  and  capital. 

Maladjustment,  however,  results  from  innate  predispo- 
sitions as  well  as  from  a  conflict  of  ideas  representing  dif- 
ferent interests  acquired  during  the  individual's  life. 
People  are  congenitally  conservative  and  radical  with  re- 
gard to  different  norms  of  living,  or  some  are  predomi- 
nantly conservative  while  others  tend  strongly  toward 
radicalism.  The  conservative  clings  to  existing  institu- 
tions and  customs,  and  is  naturally  suspicious  of  all  in- 
novations whose  practical  value  is  not  immediately  ap- 
parent. The  radical  is  disposed  to  doubt  the  goodness  of 
practices  generally  approved,  but  is  greatly  impressed 
with  the  need  of  reform  along  intellectual  or  moral  lines. 
The  one  type  seems  to  build  up  only  harmonious  associa- 
tions of  thought,  that  lead  to  further  developments  of  a 
line  of  reasoning,  but  are  incapable  of  reconstruction  into 
new  valuations ;  the  other  type,  on  the  contrary,  means  in 
professional  pursuits  a  novel  selection  of  data  and  theo- 
ries, with  the  result  that  new  vistas  of  thought  are  opened 
up,  sometimes  perhaps  to  cause  a  revolution  in  science  and 
economic  activities. 

The  radicals  are  apt  to  get  the  worst  of  it  in  the  early 
parts  of  a  transition  period;  the  conservatives  seem  out 
of  place  in  the  latter  stages  when  people  have  become 
sufficiently  acclimated  in  a  new  environment  of  thought  to 


INTEPRETATION  OF  HISTORY*  101 


see  the  shortcomings  of  the  pas"t:  '  "Tite  >illacTj<uste<J  'in, 
either  case  are  punished  for  their  minority  views  when  the 
dominant  group  of  the  ruling  class  objects  to  them.  Im- 
prisonment and  fines  are  ordinary  methods  of  chastise- 
ment. Or  more  frequently  still  we  express  our  disap- 
proval by  dubbing  the  maladjusted  ones  iconoclasts  and 
rebels,  cranks  and  fogeys,  freaks  and  maniacs.  The  in- 
novator in  science  and  art  will  be  put  down  as  a  phantast 
or  a  charlatan  until  he  has  found  an  audience  whose  sym- 
pathy gives  "  tone  "  to  his  creations.  In  politics  the  most 
defiant  of  traditions  are  known  as  radicals  or  progressives, 
or,  as  nowadays,  they  become  bolshevists  whose  teachings 
infuriate  the  standpatter.  But  not  infrequently  such  dar- 
ing spirits  have  immortalized  themselves.  They  have  died 
on  the  scaffold  only  to  be  praised  in  song  and  oratory 
thereafter.  As  patriots  and  fathers  of  their  country 
some  of  them  have  gained  undying  fame,  when  during 
their  lifetime  they  were  but  an  object  for  derision  and 
slander.  In  all  fields  of  achievement  this-  turn-about  in 
valuations  has  repeatedly  come,  and  it  will  come  again. 
The  daring  business  man  who  at  the  outset  seemed  a 
crackbrained  plunger  makes  good  eventually  as  pioneer 
and  founder  of  a  firm.  The  visionaries  and  the  heretics 
who  become  respectively  prophets  and  saints,  the  rebel 
whose  treason  inspires  later  generations,  —  they  are  all 
examples  of  maladjustment  brought  about  by  large  social 
movements. 

§  6.  The  Theory  of  Prosperity. —  However,  though 
overlappings  of  ideals  new  and  old  occur  continually,  this 
does  not  do  away  in  the  slightest  degree  with  the  reality 
of  an  objective  standard  for  measuring  welfare.  The 
economic  interpretation,  on  the  contrary,  includes  such  a 
test,  and  the  Marxian  view  implies  it  even  though  the  idea 
was  not  anywhere  elaborated.  Human  history,  from  this 


102  THE  LIMITS  OF  SOCIALISM 

standpoint,  has  meant  for  the  most  part  progress  and 
social  betterment.  In  spite  of  recurring  periods  of  mal- 
adjustment the  trend  has  been  steadily  toward  the  attain- 
ment of  a  higher  plane  of  prosperity.  The  world  is 
truly  becoming  better,  and  social  science,  having  estab- 
lished its  norm,  may  consciously  promote  the  wellbeing  of 
men.  It  would  be  fatal  for  us  to  assent  to  John  Stuart 
Mill's  dictum  that  "  questions  of  ultimate  ends  are  not 
amenable  to  direct  proof.  Whatever  can  be  proved  to  be 
good  must  be  so  by  being  shown  to  be  a  means  to  some- 
thing admitted  to  be  good  without  proof."  18  If  he  were 
correct  in  believing  that  "  the  sole  evidence  it  is  possible 
to  produce  that  anything  is  desirable  is  that  people  do  ac- 
tually desire  it  "  19 —  if  this  were  so,  then  social  science  in 
a  very  serious  sense  had  lost  its  mission. 

The  failure  of  utilitarianism  as  once  understood  is 
clearly  presaged  in  this  essay  of  a  mighty  thinker.  How- 
ever, on  the  one  hand,  we  are  convinced  these  days  that 
Mill  himself  need  not  have  rejected  the  economic  tests  be- 
cause he  started  with  pleasure  and  pain,  and  on  the  other 
hand  it  is  not  necessary  to  abjure  all  personal  tests  be- 
cause of  a  social  approach  to  the  problem. 

The  objective  tests  of  prosperity  may  be  given  first 
consideration  even  if  we  feel  bound  to  believe  in  an  Abso- 
lute such  as  happiness,  pleasure,  salvation  of  the  soul,  god- 
liness, etc.  It  is  essentially  a  question  of  coupling  a 
measurable  sort  of  welfare  with  the  immeasurable.  The 
concepts  of  a  supreme  good  which  the  Asiatics  and  Greeks 
first  formulated,  and  whose  history  is  virtually  the  history 
of  all  speculative  thought,  do  not  lend  themselves  to  meas- 
urement. We  cannot  tell  when  a  man  is  happy ;  we  can- 
not measure  different  amounts  of  pleasure  and  pain, 

is  Mill,  J.  S.,  "  Utilitarianism,"  Chapter  1. 
i»  Ibidem,  Chapter  4. 


INTEPRETATION  OF  HISTORY  103 

though  the  hedonists  once  hoped  to  find  principles  for 
measurements.  It  is  impossible  to  gauge  the  goodness  of 
a  man  if  his  innermost  creed  as  to  world  and  infinity  is  to 
serve  as  a  criterion.  The  salvation  of  the  soul  may  be 
the  greatest  of  human  achievements  and  the  sine  qua  non 
of  peace  here  on  earth,  but  its  roots  and  course  of  devel- 
opment escapes  our  vigilance,  no  matter  how  we  watch  it. 
Old  norms  then  have  failed  in  the  sense  that  we  have  not 
been  able  to  prove  their  existence  in  individual  cases,  nor 
found  any  means  of  measuring  them  and  comparing  them. 
It  is  not  an  unreasonable  conjecture  to  make,  seeing  what 
we  know  of  the  evolution  of  men,  that  the  cavedweller  was 
as  happy  or  as  good,  in  the  conventional  ethical  sense,  as 
the  modern  man.  But  if  we  compare  their  respective 
achievements  and  social  organization,  or  if  we  should  be 
able  to  test  their  respective  efficiency  and  modes  of  living, 
the  gains  of  civilization  would  stand  out  boldly  enough. 
The  poorest  may  be  happy  and  virtuous,  if  the  two  words 
are  defined  suitably,  but  so  may  the  wealthy  and  pro- 
ficient, the  healthy  and  intelligent. 

An  idiot  is  guiltless  ?  Probably.  But  we  do  not  there- 
fore put  him  on  a  par  with  the  gifted.  The  sick  are  good 
and  willing?  No  doubt,  but  their  pains  and  foibles  em- 
barrass them  nonetheless.  The  paupers  have  merry  mo- 
ments and  cultivate  their  soul?  Certainly,  but  their 
distress  is  real  for  all  that,  calling  for  redress  on  the  part 
of  a  legislator  or  friend  who  would  add  health,  wealth, 
and  efficiency  to  all  the  possible  kinds  of  goodness  the 
human  mind  has  dreamed  of.  The  need  of  an  empirical 
&nd  economic  standard  of  prosperity  is  therefore  our  need 
_for  a  goal,  in  the  attainment  of  which  society  at  large 
"shall  rest  satisfiedTand  strong.  The  need  is  for  the  pos- 
session of  goods  that  make  possible  learning  and  leisure, 
variety  of  experience  and  a  full  mete  of  self-realization. 


104  THE  LIMITS  OF  SOCIALISM 

The  functions  of  an  economic  concept  of  prosperity 
may  be  illustrated  from  the  relation  of  art  to  life.  Art 
is  an  ideal  as  well  as  a  fact  taking  sens-ible  forms. 
Art  has  always  been  lauded  as  one  of  the  highest  manifes- 
tations of  reason  and  genius.  The  world  has  produced 
much  art,  and  certain  nations  have  excelled  in  wonderful 
creations  of  music  or  painting,  architecture,  literature, 
and  sculpture.  But  the  criteria  of  art  are  elusive.  What 
is  real  art  and  what  is  banality  or  shallow  imitation  few 
will  decide.  Opinions  are  nowhere  more  subjective  than 
in  the  realm  of  art  where  canons  change  continually. 

Art  also  has  no  value  at  a  supreme  moment,  in  a 
struggle  of  nations,  in  the  contest  between  social  groups 
fighting  for  power  and  happiness  as  they  understand 
them.  The  nations  most  productive  of  art  have  had  their 
ascendancy  and  their  decline.  A  people  totally  devoid  of 
art  may  easily  score  a  victory  over  a  foe  than  whom  none 
has  achieved  finer  things  judged  aesthetically.  The  vulgar 
view  of  art,  then,  is  at  odds  with  man's  intense  desire  for 
life  and  supremacy.  Art  goes  for  nought  when  a  battle 
opens. 

The  ethical  norms,  too,  may  appear  inferior  to  none, 
but  if  they  do  not  issue  in  appropriate  social  expression 
they  leave  no  impress.  Whether  a  group  or  a  nation  shall 
live  depends  on  its  equipment  in  peace  and  war,  on  its 
treasure  of  goods,  their  volume  and  nature,  their  distribu- 
tion and  use.  He  who  is  healthy  has  an  advantage  over 
the  ailing.  He  who  has  wealth  is  better  off  than  the  poor, 
if  otherwise  their  lots  are  equal.  He  who  can  do  things 
is  superior  to  the  helpless  and  ignorant. 

But  the  economic  norm  of  prosperity  is  social.  Only 
for  large  groups  of  people  living  together  can  efficiency, 
health,  and  wealth  be  tested.  Individual  training  is  not 
the  only  factor  of  importance  in  the  productiveness  of  a 


INTEPRETATION  OF  HISTORY  105 

nation,  as  history  has  shown  from  earliest  days  on.  As 
soon  as  individual  self-sufficiency  came  to  an  end,  as  a 
result  oFT;he  economies  of  division  of  labor,  proficiency 
took  on  a  social  meaning.  Thereafter  the  usefulness  of  a 
man  was  shown  best  when  he  produced  jointly  with  others. 

And  so  with  health  and  wealth.  They  count  most  when 
related  to  communities  as  a  whole,  to  nations  and  races. 
Wars  are  won  by  nations  whose  social  organization  per- 
mits them,  in  various  ways,  to  promote  the  norms  of  pros- 
perity more  generally  than  their  opponents  are  capable  of. 

Virtue  is,  at  a  crucial  moment,  good  citizenship.  It 
points  to  the  right  place  for  the  individual  among  his 
fellowmen  whose  wellbeing  is  ordinarily  his  own.  Such 
virtues  are  consequently  measurable  by  particular  forms 
of  conduct.  We  can  tell  whether  a  man  has  sinned  against 
the  rules  of  health  and  efficiency  when  we  have  no  means 
of  finding  out  whether  he  believes  all  that's  in  a  cate- 
chism. 

Wealth  in  tangible  goods  is  as  essential  to  progress  as 
it  is  fit  for  measurement  and  comparison.  The  inherent 
ingenuity  of  man  accounts  for  the  first  steps  toward  civ- 
ilization, but  once  wealth  was  acquired  it  became  a  further 
guarantee  of  progress.  For  surplus  means  leisure  and 
JT|nj_pfi.3iTig  specialization  of  workers, ^and  this  in  turn  en- 
hances social  productiveness.  Education  is  impossible 
without  leisure.  The  modern  forms  of  research  could  not 
continue  if  our  regular  surplus  of  goods  were  suddenly  to 
disappear.  Much  work  would  then  stop.  Production  it- 
self, however,  necessitates  also  technical  cooperation,  a 
corollary  of  which  is  a  sense  of  interdependence  and  a 
social  conscience,  that  is  a  feeling  of  worth  in  our  fellow- 
men,  our  rivals  or  friends.  Wealth  brings  cumulatively 
the  means  of  communication  which  perpetuate  knowledge 
and  help  disseminate  it  among  the  masses.  And  since  the 


106  THE  LIMITS  OF  SOCIALISM 

power  of  our  association  of  ideas  varies  largely  with  their 
range  and  character,  early  training  and  selection  become 
important.  Thus  methods  of  production  stand  in  some 
ratio  to  existing  wealth.  We  learn  to  "  find  "  ourselves, 
to  trace  correlation  expressive  of  health  and  illness.  Our 
hygienic  and  sanitary  measures  are  prophylactic  as  well  as 
corrective.  The  general  round  of  wealth,  leisure,  knowl- 
edge, proficiency,  health,  vigor,  and  production  repeats 
itself  endlessly.  There  is  no  other  way  of  attaining  pros- 
perity than  the  economic,  though  we  may  translate  this 
into  visions  of  personal  value,  into  precepts  of  conduct 
sanctioning  what  the  biological  and  psychological  facts 
have  already  urged.  The  sociologist,  thus,  will  utilize 
their  data  for  purposes  of  understanding  social  inter- 
course in  general,  but  the  economist  has  to  add  the  rides 
of  production  and  exchange  by  which  wealth,  health,  and 
efficiency  are  procured  most  abundantly. 

§  7.  Summary  on  the  Economic  Interpretation  of 
History. —  To  conclude.  The  economic  interpretation  of 
history  comprises  several  noteworthy  points.  Fir^fef- the 
tracing  of  a  causal  relation  between  economic  and  non- 
economTc  events  is  an  idle  undertaking  because  all  life  is 
a  unit  and  all  economics  the  product  of  a  mental  unit: 
manhimself.  The  concept  of  causation  is  evidence  merely 
6~F~our  penchant  for  selection  and  concentration.  All 
events  are  interrelated,  but  it  is  as  correct  to  write  a  his- 
tory of  religion  without  resort  to  economics  as  to  record 
economic  developments  without  injecting  a  dissertation 
on  religion.  The  precise  bearing  of  one  on  the  other  is  a 
rather  personal  matter. 

In  the  second-place,  the  sufficiency  of  a  purely  empiri- 
cal viewpoint  cannot  be  doubted.  We  can  never  do  with- 
out premises  in  one  respect,  but  all  the  attempts  of  the 


INTEPRETATION  OF  HISTORY  107 

metaphysician  have  presumed  upon  our  credulity  by  tak- 
ing for  granted  much  of  what  was  to  be  explained  and 
proven.  Socialism  has  done  better,  therefore,  by  con- 
fining its  investigations  to  a  world  realistically  conceived 
and  familiar  to  all.  The  materialistic  viewpoint  has 
proven  useful,  for  it  has  helped  us  to  think  of  society  as 
governed  by  fundamental  instincts  instead  of  its  being  the 
pet  of  Providence. 

In  the  thirdj^lace,  maladjustment  is  a  regular  part  of 
life  springing  from  the'veTy^foundations  of  human  nature 
wand~its~relation  to  a  changeable  environment..  We  shall 
perhaps  never  eliminate  it  completely.  For  this  reason 
alone,  if  for  no  other,  the  Marxian  aim  at  a  millennium 
must  lead  to  disillusionment.  Misery,  tho  best  understood 
as  a  social  excrescence,  is  yet  something  for  which  science 
has  so  far  found  no  single  antidote.  We  cannot  expect  a 
cure  by  one  step,  nor  a  curing  of  evils  by  one  means  ap- 
plied to  all  times. 

In  the  fourth  place^  the  facts  of  biological  and  social 
sciences  lead  us  to  the  adoption  of  a  utilitarian  stand- 
point, but  utility  is  then  not  defined  as  pleasure  or  ab- 
sence of  pain.  The  norms  of  welfare  are  not  individual 
whose  aggregate  sums  make  prosperity  for  the  nation  at 
large.  Our  norms,  rather,  must  be  objective  even  for  the 
individual.  Not  his  feeling's,  but  facts  of  health,  wealth, 

^Hi^*-~ — —  c-i      /          .  ^ 

and  efficiency  decide  the  question.  In  part  individually, 
in  part  socially  measdi'able,  Llity  Tell  us  what  degree  of 
wellbeing  a  people  has  reached,  and  how  it  compares  with 
other  social  units.  Correspondingly  virtue  is  not  creed, 
but  conduct.  The  test  of  virtue  is  not  suffering,  as  the 
Flagellants  and  like-minded  folk  preached,  but  service,  as 
taught  by  the  Christ. 

The  economic  interpretation  of  history  comprises  this 


108  THE  LIMITS  OF  SOCIALISM 

view  of  goodness  and  righteousness.  It  embraces  the 
whole  field  of  conduct  associated  formally  with  ethics,  and 
logically  compels  socialism  to  redefine  justice.  Pros- 
perity is  the  result  of  just  relations  between  men,  but  that 
they  are  just  is  shown  by  the  objective  realities  studied 
chiefly  by  economists. 


CHAPTER  V 
JUSTICE 

§  i.  The  Principle  of  Differentiation. —  The  founders 
of  socialism  said  little  about  justice,  but  a  great  deal 
about  the  evils  of  an  unequal  distribution  of  wealth. 
They  were  interested  in  the  principles  of  sociation  and  of 
economics,  not  in  abstract  questions  of  right  and  wrong. 
Their  works  abound  in  passages  criticizing  theoretical 
positions  of  an  opponent,  while  to  the  sentimental  plead- 
ings of  the  Utopians  they  turned  a  deaf  ear.  Since  then 
the  attitude  of  socialists  has  remained  about  the  same. 
They  have  insisted  on  an  objective  treatment  of  socio- 
logical subjects.  They  have  sought  to  lay  bare  the  foun- 
dations of  the  social  structure  rather  than  launch  reforms 
from  a  sense  of  morality  or  fair  dealing.  Scientific  so- 
cialism has  endeavored  to  understand  the  laws  of  nature 
rather  than  individualistic  concepts  of  justice  and  good- 
ness. 

Yet  the  definition  of  justice  is  a  corollary  to  the  eco- 
nomic interpretation  of  history  proclaimed  by  Marx  and 
Engels,  and  the  idea  of  a  better  world  in  which  equity 
vshould  rule  for  the  protection  of  all  is  really  prominent 
in  the  teachings  of  socialism.  What  is  popularly  sep- 
arated from  matters  of  fact  as  a  distinct  question  of 
ethics  has  been  by  socialists  incorporated  with  social  sci- 
ence. Ethics  and  economics  have  been  fused  into  one 
single  topic.  There  is  no  way  of  answering  the  questions 
first  put  by  Marx  without  reaching  also  some  definite  con- 

109 


110  THE  LIMITS  OF  SOCIALISM 

elusions  on  the  ends  of  government  and  the  nature  of 
justice. 

But  the  definition  is  implied  rather  than  stated  in  so 
many  words.  And  again,  the  modern  view  of  history  or 
of  social  processes  and  of  prosperity  does  away  with  the 
old-time  notion  of  a  distinct  science  of  ethics  detachable 
from  social  sciences,  such  as  sociology  and  economics  are. 
Justice  cannot  be  defined  in  general  terms.  To  try  it  is 
even  less  profitable  than  defining  fundamentals  in  other 
sciences.  As  soon  as  we  seek  to  embrace  all  in  a  single 
sentence  we  lose  the  meaningfulness  of  words.  They  be- 
come nondescript  and  unsatisfactory  to  all  but  a  few  of 
the  initiated.  And  to  them  the  broadest  definitions  are 
useful  only  because  supported  by  a  wealth  of  particulars 
held  in  the  background  of  consciousness. 

What  is  justice?  The  definition  would  resemble  the 
vagueness  of  definitions  on  matter  and  force,  life  and 
space,  electricity  and  motion,  mind  and  value  and  time. 
We  define  such  words,  but  make  mental  reservations.  Our 
ideas  change,  and  we  have  to  redefine.  Science  changes  its 
point  of  view  and  stresses  new  facts.  The  life  of  a  thinker 
is  a  quest  for  definitions.  He  would  give  contents  to  the 
vehicles  of  expression  that  the  man  on  the  street  uses  so 
lightly.  It  is  the  mark  of  a  thinking  man  that  he  knows 
what  his  words  mean,  and  differentiates  nicely  between 
their  exact  meanings.  But  the  largest  concepts  cannot 
be  defined  so  as  to  have  lasting  value  for  science.  Jus- 
tice may  be  defined  a  half  a  dozen  ways  without  giving  us 
an  idea  of  its  relation  to  everyday  experience.  Justice 
should  be  referred  to  particulars. 

There  is  another  approach  to  the  problem  of  justice 
which  agrees  well  with  the  scientific  viewpoint  of  social- 
ism. We  may  go  over  all  the  cases  of  justice  or  injustice 
that  we  can  remember,  and  we  shall  then  notice  that  the 


JUSTICE  111 

question  always  turns   on  a  comparison  of  inequalities. 

Life  is  nothing  if  not  inequalities  as  to  things,  and  be- 
tween men.  No  two  things  are  exactly  alike.  This  is  a 
trite  saying.  Differences  are  the  rule,  and  resemblances 
are  only  of  a  degree.  In  physical  environment,  in  the 
characters  of  men,  and  in  the  institutions  of  society  the 
fact  of  inequality  attracts  our  attention. 

The  world's  resources  for  instance  are  very  unequally 
divided  between  nations,  some  having  an  abundance  of 
mineral  and  good  soil,  and  others  practically  nothing  of 
either.  The  Eskimo  might  compare  his  fate  with  the 
Frenchman's  or  American's,  and  bewail  his  fate.  Or  the 
Patagonian  might  gaze  with  envy  upon  the  riches  be- 
stowed by  nature  upon  his  northern  neighbors  in  the  Ar- 
gentine. Races  in  prehistoric  times  settled  in  different 
parts  of  the  globe,  or  migrated  several  times  since  then. 
They  cannot  be  said  to  have  chosen  their  abode  with  an 
eye  to  resources  excepting  fertility  of  soil,  for  the  kinds 
of  wealth  which  are  now  prized  most  highly  were  then  un- 
known as  an  instrument  for  progress.  It  is  chance  that 
gave  to  some  great  resources,  while  others  were  allotted  a 
meager  store  of  bare  necessities. 

So  with  the  differences  among  humans.  Sex  itself  is  a 
differentiation  of  far  reaching  import.  We  might  com- 
pare the  characteristic  activities,  the  burdens  and  privi- 
leges, of  male  and  female  and  find  much  that  seems  unjust 
in  a  sense.  At  times  we  have  been  so  told.  Or  there  are 
race  traits  to  compare ;  the  superiorities  of  a  white  man 
over  the  Hottentot  and  the  mode  of  living  which,  in  part 
resulting  from  these  differences,  drives  the  two  groups  far 
apart.  History  is  colored  deeply  by  racial  characteris- 
tics. It  is  folly  to  overlook  them  in  a  larger  survey. 

And  what  of  the  inborn  differences  traced  to  heredity  or 
to  variation  ?  What  of  the  strong  in  body  and  mind,  and 


THE  LIMITS  OF  SOCIALISM 

the  frail?  What  of  the  subnormal  and  the  super-normal, 
the  types  of  personality  that  are  to  be  met  everywhere  in 
life?  The  variety  is  bewildering  and  is  said  to  lend  charm 
to  life.  Probably  so.  But  the  fact  of  such  differences 
remains  and  cannot  be  attributed  to  any  particular,  meas- 
urable action  of  those  possessing  the  advantages  or  the 
handicaps.  We  simply  accept  the  differences.  We  know 
that  some  are  born  lucky  and  others  unlucky.  We  know 
that  some  will  struggle  throughout  life  without  achieving 
anything  unusual,  while  others  will  succeed  virtually  with- 
out effort.  We  know  that  the  pretty  girl  is  surrounded 
by  admirers  and  looks  forward  to  all  sorts  of  blessings, 
when  her  less  comely  sister  is  left  to  walk  alone.  We  know 
that  some  will  work  creatively  and  reap  rewards,  while  the 
less  gifted  but  perhaps  more  industrious  will  live  in  pen- 
ury, forgotten  and  cheerless. 

History  is  itself  a  record  of  differences  sometimes  ap- 
palling to  behold.  What  cruelties  and  hardships  have  be- 
fallen millions  of  innocent  people !  We  read  of  catas- 
trophes wiping  out  the  lives  of  thousands.  We  hear  of 
cripples  and  the  demented,  or  of  miserable  wretches 
stricken  with  loathsome  diseases.  We  read  that  an  ex- 
plosion has  killed  so  many  miners  in  a  second.  We  think 
of  the  wars  that  have  killed  and  maimed  hundreds  of 
millions  for  no  reason  except  that  life  seems  to  be  a  battle 
in  which  some  fight  and  suffer  more  than  others.  We 
turn  the  pages  of  a  History  of  the  World  and  are  im- 
pressed with  nothing  so  much  as  with  the  inequalities  of 
men  and  their  fates.  And  many  have  endured  horrible 
pains.  Indeed,  one  might  add  that  the  path  of  human 
progress  is  strewn  with  the  wrecks  of  men  and  women  who 
suffered  without  guilt.  Some  were  put  to  horrible  tor- 
tures or  consigned  to  the  flames.  Some  were  immured 


JUSTICE  113 

alive  or  flayed  to  death.  Some  died  on  the  rack,  and 
others  were  butchered  as  a  sacrifice  to  false  gods.  Many 
perished  from  famine,  and  others  again  fell  a  prey  to  wild 
beasts.  If  differences  as  such  are  to  count  in  the  problem 
of  justice,  why  should  we  not  muse  over  the  mysteries  of 
Fate  that  let  some  live  amidst  the  comforts  of  the  twentieth 
century  while  the  great  majority  lived  a  coarse  struggling 
life  in  the  earlier  stages  of  human  development?  As  the 
believer  in  justice  sees  it,  these  differences  form  a  dis- 
enchanting chapter  in  the  history  of  the  world. 

And  yet  this  is  not  all.  For  we  have  still  two  other 
types  of  disparity  to  remember,  to  wit,  the  socio-economic 
stratification,  and  the  suffering  of  the  innocent  for  the 
guilty. 

As  to  the  former,  the  evidence  is  about  us  abundantly. 
It  forms  the  chief  theme  of  reformers,  and  is  a  cardinal 
point  in  the  program  of  socialism.  The  world's  goods, 
they  say,  are  too  unevenly  divided.  Some  are  born  rich 
and  others  never  save  a  penny.  Some  toil  but  remain 
poor,  while  others  bask  in  affluence  without  turning  a 
finger.  As  goods  are  distributed,  so  are  the  pleasures 
and  privileges  that  money  can  buy  or  that  it  procures  in- 
directly. It  is  for  some  to  walk  in  the  best  of  society  — 
however  understood  —  and  to  shape  the  destiny  of  mil- 
lions, while  the  multitude  follows  and  sees  little  of  what 
their  age  represents.  Some  will  shoulder  burdens  to  re- 
lieve others  who  tread  lightly  and  carefree.  In  a  war, 
for  instance,  one  group  goes  to  the  front,  perhaps  never 
to  return,  or  worse  yet,  to  return  crippled  and  helpless. 
But  another  group  stays  at  home  because  its  services  are 
needed  there,  or  for  some  less  pressing  reason.  The  stay- 
at-homes  may  be  getting  their  deserts,  but  note  that  they 
live  in  comforts  and  grow  rich  while  their  compatriots  go 


114*  THE  LIMITS  OF  SOCIALISM 

into  a  living  death.  And  often  the  brave  are  slain,  and 
the  pretenders  thrive.  How  common  indeed  that  heroes 
are  buried  by  hypocrites ! 

The  innocent  also  get  the  worst  of  it  when  the  offender 
goes  scot  free.  We  see  defenseless  nations  insulted  and 
abused  by  unscrupulous  neighbors,  by  the  Goliaths  who 
are  itching  for  a  fight.  We  see  a  neutral  nation  pay  for 
the  follies  of  the  combatants.  We  see  a  whole  nation  suf- 
fer for  the  wrongs  of  its  government  which  after  all  is 
not  truly  representative.  Or  perhaps  the  children  pay 
for  the  sins  of  their  fathers,  or  we  must  make  good  the 
losses  incurred  by  careless  friends. 

All  this  and  more  is  common  knowledge.  The  inequali- 
ties have  always  existed  and  must  be  expected  to  recur  on 
general  principles  of  induction.  We  cannot  eradicate  all 
of  them.  There  are  some  beyond  our  control,  as  well  as 
others  that  we  may  consider  the  expressions  of  will  on 
the  part  of  men. 

We  shall  have  to  discriminate  but  we  shall  also  feel 
compelled  to  admit  that  life  without  inequalities  is  un- 
thinkable. The  task  of  the  reformer  is  not  the  uni- 
formization,  but  the  coordination  of  specialized  forms  of 
living  so  that  the  largest  number  of  people  may  live  in 
relative  peace  and  contentment.  Not  a  leveling  for  its 
own  sake,  but  leveling  with  a  view  to  progress,  this  is  the 
task  before  us.  To  level  rights  and  duties  for  classes  of 
people  rather  than  for  all  people,  this  must  be  our  aim. 
Differentiations  are  the  prime  characteristic  of  life,  and 
the  price  of  evolution.  We  cannot  abolish  them.  But 
we  can  divide  society  into  groups  with  specialized  func- 
tions, and  then  assign  to  each  its  burdens  and  privileges. 
Equality  for  all  in  a  given  class,  such  leveling  is  feasible. 
Equal  rights  for  all  members  in  a  certain  occupational 
class,  or  of  an  age  group,  or  per  sex,  or  relative  to  civic 


JUSTICE  115 

status,  and  so  on.  This  is  the  sort  of  uniformity  com- 
patible with  economic  advancement  and  urged  by  our  ob- 
jective norms  of  prosperity.  All  self-imposed  or  socially 
induced  forms  of  pain  should  be  eliminated. 

§  2.  The  Nature  of  Justice —  Such  a  view  of  equaliz- 
ation suggests  also  several  negative  answers  to  the  prob- 
lems of  justice.  It  is  clear,  for  instance,  that  the  promise 
of  heavenly  rewards  cannot  hush  the  protests  of  the  un- 
lucky, for  according  to  this  promise  the  fortunate  here  on 
earth  will  fare  equally  well  in  the  hereafter.  Where,  then, 
is  the  logic  of  inequality  during  this  life? 

Again,  justice  cannot  be  called  rightly  an  institution 
of  nature,  as  was  held  by  the  ancients  and  by  philosophers 
since.  This  idea  that  nature  is  peace  and  happiness,  and 
society  a  decline  and  fall  from  virtue,  is  pure  superstition, 
however  revered  it  may  be  by  some  who  are  more  influ- 
enced by  religious  promptings  than  by  facts.  There  is 
nothing  to  show  that  the  jungle  life  is  more  pleasant  than 
ours.  On  the  contrary,  we  have  proof  of  its  being  every- 
where a  harsh  struggle,  and  most  so  among  the  brutes. 
Nature  has  not  set  the  table  for  men.  What  they  want 
they  must  for  the  most  part  earn.  Life  is  a  battle,  not 
a  frolic  and  minstrel  show.  The  naturalistic  view  of 
origins  of  injustice  is  as  fanciful  as  its  conclusions  on  the 
founts  of  constitutional  government. 

In  thethird  place,  we  may  also  be  sure  that  norms  of 
equity  cannot  be  based  on  mere  intuitions.  No  more 
than  men  by  nature  are  altruistic  are  they  capable  of 
distinguishing  between  right  and  wrong.  The  history  of 
morals,  which  has  been  studied  by  many  men  with  great 
diligence,  shows  the  relativity  of  ethical  norms  and  the 
immense  variety  of  conceptions  on  right  and  wrong.  At 
different  times  different  codes  of  conduct  have  arisen. 
Any  one  who  observes  has  profited  in  this  respect  from  his 


116  THE  LIMITS  OF  SOCIALISM 

travels.  We  see  much  dissension  among  people  on  identi- 
cal points.  Customs  vary,  and  laws  reflect  the  economic 
setting  of  officially  sanctioned  demands  for  justice.  Laws 
cannot  be  understood  to  make  justice,  for  what  is  held 
just  at  one  time  may  become  unsatisfactory  long  before 
the  lawmaker  adapts  himself  to  the  change.  This  phase 
of  maladjustment  has  been  discussed  in  an  earlier  chap- 
ter. Laws  do  not  create  justice,  but  they  give  evidence 
of  norms  accepted  by  people  as  right  or  fair.  Law  is  a 
derivative  whose  original  is  science  or  the  mores  or  the 
standard  set  by  exceptional  men. 

Justice,  then,  is  this  one  positive  thing,  whatever  else 
may  be  said  about  it:  Justice  refers  to  human  institu- 
tions and  to  facts  of  life  unknown  to  barbarism.  Justice 
is  an  ideal  presupposing  a  reasoning  man,  a  willing  being, 
a  responsible  being.  Justice  is  for  thinking  men  on  an 
advanced  level  of  living.  Only  when  somehow  we  be- 
lieve ourselves  as  individuals  capable  of  willed  action,  only 
when  we  possess  the  ability  to  foresee  certain  events  or 
to  master  a  set  of  relations,  only  then  are  we  fit  to  de- 
velop a  notion  of  justice  and  to  govern  ourselves  accord- 
ingly. Justice  is  a  general  policy  comprising  actions 
suited  to  reason  and  responsibility.  The  things  we  can 
control  become  subjects  for  reform.  The  facts  utterly 
beyond  our  guidance  we  leave  out  of  the  equation.  Jus- 
tice always  is  a  social  norm  that  deals  with  the  relations 
between  thinking  and  striving  members  of  a  large  whole. 
That  is  just  which  subserves  the  end  of  the  largest  possible 
number,  after  the  end  has  been  defined  according  to  the 
dictates  of  social  science.  Justice  is  an  ideal  of  social 
relations  and  of  aims  varying  with  times. 

"  Right,"  the  author  of  *4  Folkways  "  informs  us,  "  can 
never  be  natural,  or  God-given,  or  absolute  in  any  sense. 
The  morality  of  a  group  at  a  time  is  the  sum  of  the  — 


JUSTICE  117 

folkways  by  which  right  conduct  is  defined.  Therefore 
morals  can  never  be  intuitive.  They  are  historical,  insti- 
tutional, and  empirical."  *  The  just  act  is  one  which  is 
conducive  to  the  welfare  of  the  largest  possible  number, 
welfare  having  previously  been  rated  by  the  economic  tests 
compared  to  which  all  other  norms  are  subjective  and  in- 
capable of  measurement.  "  The  problem  of  morality  is 
the  formation,  out  of  the  body  of  original  instinctive  im- 
pulses which  compose  the  natural  self,  of  a  voluntary  self 
in  which  socialized  desires  and  affections  are  dominant, 
and  in  which  the  last  and  controlling  principle  of  delib- 
eration is  the  love  of  the  objects  which  will  make  this 
transformation  possible." 

We  repeat,  justice  has  connotations  of  reason  and  re- 
sponsibility socially  utilized.  Irrational  people  cannot 
be  expected  to  deal  squarely  with  their  fellowmen.  Or, 
since  this  test  of  reason  itself  is  the  power  of  coordinating 
efforts,  we  had  better  admit  that  justice  is  reason,  and 
that  the  objective  tests  of  social  welfare  furnish  the  best 
proof  for  the  existence  of  either.  When  society  pro- 
gresses and  th,e  need  of  the  average  man  is  reflected  in  the 
strength  of  the  larger  unit,  then  justice  prevails.  It  is 
justice  in  the  long  run,  in  large  categories,  in  vital  affairs 
that  matters.  Sacrifices  of  self  and  of  detail  is  insepar- 
able from  justice  properly  conceived.  "  Justice  may  be 
defined  as  such  an  adjustment  of  the  conflicting  interests 
of  the  citizens  as  will  interfere  least  with,  and  contribute 
most  to,  the  strength  of  the  nation."  2  The  might  of  the 
many,  measured  in  terms  of  health,  wealth  and  efficiency, 
is  the  sole  available  proof  of  the  general  prevalence  of 
justice.  And  in  a  struggle  between  different  social  groups 
or  between  nations  it  will  appear  soon  enough  as  to  where 

iSumner,  W.  G.,  "Folkways,"  p.  29. 

2  Carver,  Th.  N.,  "  Essays  in  Social  Justice,"  p.  9. 


118  THE  LIMITS  OF  SOCIALISM 

justice  has  asserted  itself  most  completely.  There  are 
degrees  of  justice  from  the  social  standpoint,  whatever 
our  opinion  about  justice  in  a  particular.  We  may  con- 
sider a  man  either  right  or  wrong,  a  verdict  either  just  or 
unjust,  disdaining  to  bicker  about  shades  and  shares. 
But  since  justice  is  for  individual  cases  and  since  life 
comprises  so  many  duties  and  rights  it  is  inevitable  that, 
while  in  some  respects  we  are  just  to  each  other,  in  others 
we  are  not.  The  ideals  of  politics  and  economics  center 
about  such  weighing  of  pros  and  cons,  our  choice  finding 
expression  in  social  structure  and  economic  or  military 
power. 

Grant  the  will-to-live,  and  you  must  grant  the  worth  of 
social  strength.  Grant  reason  in  man  and  you  will  want 
to  hold  him  responsible  for  his  action.  Grant  norms  of 
conduct  however  evolved  or  formulated,  and  you  will  con- 
sult them  before  long  when  passing  judgment  on  par- 
ticulars. Will  is  assumed  as  a  means  of  eliminating  the 
unfit.  The  freedom  of  the  will  is  a  tactical  device  by 
which  we  can  compare  the  good  with  the  bad  and  endeavor 
an  adjustment  of  conflicting  wishes.3  Will  is  basic  to 
justice,  just  as  the  law  of  averages  is  back  of  our  notion  of 
the  ought.  But  will,  the  psychologist  knows,  is  the  sub- 
jective aspect  of  a  condition  as  suitable  for  examination 
as  the  facts  of  motion.  To  say  that  one  ought  to  do  a 
certain  thing  merely  means  that  as  a  rule  such  acts  will 
prove  beneficial  according  to  definition,  or  that  out  of  a 
hundred  men,  put  in  a  given  situation,  a  certain  per- 
centage would  act  as  the  particular  one  "  ought  to." 
What  the  majority  does  conformable  to  the  needs  of  so- 
ciety, to  needs  that  sometimes  are  objectively  verifiable 

3  Mill,  J.  S.,  in  his  "Logic"  (Book  Six,  Chapter  2,  No.  2)  gives 
a  definition  of  determinism  which  seems  still  the  most  lucid  and 
comprehensive  of  many  offered  by  logicians. 


JUSTICE  119 

and  measurable  but  at  other  times  are  accepted  by  rea- 
soning from  analogy  without  careful  testing,  that  becomes 
moral.  The  injunction  to  act,  the  assertion  that  a 
certain  thing  ought  to  be  or  ought  to  be  done,  rests 
on  a  belief  that  in  most  cases  justice  will  thereby 
triumph. 

The  much  mooted  topic  of  motives  versus  results  loses 
its  vexatious  character  when  treated  as  a  matter  of  aver- 
ages. If,  e.  g.,  I  am  instrumental  in  a  child  being  run 
over  through  my  attempting  to  save  it  from  that  very 
fate,  the  result  is  taken  to  be  an  exception  to  the  rule. 
Extenuating  circumstances  will  be  pleaded  because  I  acted 
in  good  faith,  i.  e.,  with  the  intention  of  saving  the  child 
from  impending  danger.  It  will  be  argued  that  in  most 
cases  such  a  policy  on  my  part  brings  good  results,  and 
that  consequently  my  failure  in  a  particular  instance  is 
a  contingency  to  be  reckoned  with.  The  principle  is 
deemed  more  vital  than  any  one  application  of  it,  be  it 
successful  or  not.  Thus  the  law  may  condemn  me,  but 
my  sin  is  pardonable  in  the  eyes  of  most  witnesses.  Leni- 
ent treatment  will  be  urged. 

Motives,  therefore,  assume  a  moral  aspect  only  in  the 
sense  that  they  are  forecasts  of  events  which  in  them- 
selves are  either  social  or  anti-social.  If  the  former, 
motives  are  excusable  though  leading  to  undesirable  re- 
sults in  one  instance;  if  the  latter,  motives  are  repre- 
hensible though  leading  accidentally  to  good  results.  Mo- 
tives in  this  respect  are  like  efforts  spent  in  doing  a  piece 
of  work.  I  may  work  hard  and  get  results  not  com- 
mensurate with  my  efforts  and  unsatisfactory  by  ob- 
jective tests.  My  reward  will  agree  with  the  net  result, 
not  with  the  labor  expended.  But  in  the  long  run,  it  is 
true,  a  man  is  the  more  likely  to  accomplish  great  things, 
the  harder  he  tries,  the  more  tireless  his  striving.  Hence 


120  THE  LIMITS  OF  SOCIALISM 

it  is  not  unfair  or  illogical  to  rate  men  somewhat  by  their 
tenacity  and  diligence. 

§  3.  Justice  and  Competition — If  we  apply  this 
maxim  of  average  results  and  of  reasoning  by  analogy, 
for  an  individual  act,  to  the  relation  between  religion  and 
economics,  or  of  might  to  right,  we  shall  be  able  to  solve 
what  otherwise  may  appear  an  unsolvable  proposition. 

It  has  often  been  argued  that  Christianity,  for  instance, 
is  irreconcilable  with  economics  or  with  common  practice, 
and  similarly  that  socialism  is  incompatible  with  religion. 
However,  the  antinomy  is  not  one  given  by  two  contrast- 
ing viewpoints,  but  rather  it  results  from  one-sided  in- 
terpretations and  abstractions. 

The  Christian  creed  is  of  course  a  mixture  of  many 
tenets  not  all  of  which  belong  to  the  Gospel  as 
originally  preached  so  far  as  historical  investigation  has 
been  able  to  ascertain.  We  have  the  eschatology  and  the 
golden  rule,  the  one  chiefly,  though  not  entirely,  developed 
after  the  death  of  the  founder  of  Christianity,  and  the 
other  antedating  even  the  advent  of  the  Christ. 

The  preachings  on  a  .monotheistic  world  order,  on  an 
absolute  God,  his  fatherhood,  and  the  endowment  of  man 
by  God  with  faculties  of  reason  and  with  infallible  intu- 
itions of  right  and  wrong,  these  teachings  which  are 
grouped  about  the  doctrine  of  an  immortal  soul  and  re- 
demption by  proxy  may  be  conveniently  detached  from 
the  moral  code.  The  Sermon  on  the  Mount  has  a  value 
independent  of  the  theological  superstructure.  The  idea 
of  a  forgiving  father  and  of  a  final  court  of  appeal  above 
human  jurisdiction  anchors  deep  in  the  human  breast. 
It  will  be  true  in  all  ages  that  the  leveling  of  rights  as 
preached  in  the  brotherhood  of  men  has  salutary  social 
effects.  It  is  an  axiom,  also,  among  scientists  that  their 
own  conclusions  are  subject  to  error  and  to  occasional 


JUSTICE 

correction,  and  that  all  inquiries  of  the  mind  have  limits 
beyond  which  men  may  still  hope  and  aspire  to  unknown 
things. 

But  on  the  other  hand,  the  moral  precepts  of  all  great 
religious  teachers  have  been  one-sided.  They  have  looked 
to  only  one  out  of  several  relations  existing  with  regard 
to  any  problem.  Thus  the  precepts  of  Christianity  are 
bold  abstractions  from  concrete  instances.  They  are  the 
fruit  of  reasoning  by  analogy.  For  instance,  it  is  good 
to  treat  others  as  we  would  treat  our  own  self,  but,  to 
begin  with,  human  nature  is  not  altogether  of  that  in- 
clination, and  in  the  second  place  a  rigid  regard  for  this 
ruling  would  lead  not  infrequently  to  self-effacement.  Bi- 
ologists are  not  sure  that  evolution  could  have  operated 
exclusively  on  that  principle. 

The  way  out  of  the  apparent  conflict  between  religion 
and  reality  is  not  a  campaign  for  changing  human  nature, 
but  a  return  to  other  facts  in  the  situation,  and  to  a  re- 
construction of  our  religious  beliefs.  There  is  a  social 
basis  for  religion.  In  the  measure  that  our  abstractions 
are  reconverted  to  the  concrete  conditions  whence  they 
sprang  shall  we  succeed  in  uniting  theory  and  practice 
without  destroying  the  social  fabric.  Economics,  for  in- 
stance, will  be  able  to  adopt  a  collectivistic  viewpoint 
without  ceasing  to  be  scientific  if  it  abandons  some  of  its 
problems  which  an  earlier  age,  before  natural  and  social 
sciences  had  far  progressed,  had  set,  and  if  it  subordinates 
ethics  to  social  science  instead  of  borrowing  from  meta- 
physicians. The  stand  taken  by  classic  economics  to- 
ward questions  of  morality,  which  once  were  associated 
with  metaphysics,  is  responsible  for  the  seeming  heartless- 
ness  which  some  critics  detected  in  professional  economists. 
It  made  John  Ruskin  say :  "  I  neither  impugn  nor  doubt 
the  conclusion  of  the  science  [he  refers  to  economics],  if 


THE  LIMITS  OF  SOCIALISM 

its  terms  are  accepted.  I  am  simply  uninterested  in  them, 
as  I  should  be  in  those  of  a  science  of  gymnastics  which 
assumed  that  men  had  no  skeletons."  It  elicited  from 
Carlyle  the  characteristic  exclamation :  "  All  this  Mam- 
mon Gospel  of  Supply  and  Demand,  Competition,  Laissez 
Faire,  and  the  Devil  take  the  hindmost,  begins  to  be  one  of 
the  shabbiest  Gospels  ever  preached,  or  altogether  the 
shabbiest."  5 

The  "  economic  man  "  was  somewhat  of  an  abstraction, 
but  even  more  so  is  the  definition  of  justice  and  of  the  ul- 
timate good  whose  study  the  economists  wished  to  leave 
to  another  line  of  thinking. 

Competition  need  not  be  what  the  "  dismal  science  " 
made  it.  It  need  not  incite  the  admirer  of  the  Christian 
creed  to  the  thought  that  "  competitive  industry  and 
commerce  are  based  on  selfishness  as  the  dominant  instinct 
and  duty,  just  as  Christianity  is  based  on  love." 6  If 
the  fault  were  as  grave  as  pictured,  if  "  our  whole  socio- 
economic  structure  rests  theoretically  upon  the  appeal  to 
the  selfish  — ,"  7  then  socialism  would  logically  be  the  only 
alternative  to  individualism. 

It  may  be  so  anyhow,  though  for  different  reasons. 
But  recent  interpretations  of  fair  competition  have  sug- 
gested a  way  out,  and  the  conception  of  the  Ought  as  an 
estimate  of  average  results  desirable  to  society  as  a  whole, 
does  a  similar  service. 

Competition  has  by  the  courts  been  considered  fair 
when,  first,  the  inequalities  between  competing  parties  are 

*  Ruskin,  J.,  in  his  "  Unto  This  Last." 

s  Carlyle,  Th.,  "Essays,  Past  and  Present:  The  Working  Aristoc- 
racy." 

e  Rauschenbusch,  W.,  "  Christianity  and  the  Social  Crisis,"  p.  310. 
See  also  the  same  author's  "  Christianizing  the  Social  Order." 

7  Murdoch,  J.   G.,  "  Economics  as   a   Basis  of  Living   Ethics,"  p. 
47. 


JUSTICE 

natural,  as  for  instance  the  innate  differences  of  ability 
and  temperament,  or  when  secondly,  the  differences  arise 
accidentally,  as  at  the  outbreak  of  the  war,  which  gave 
some  dealers  a  great  advantage  over  those  not  stocked  up 
with  European  products ;  or  in  the  third  place,  when  the 
differences  are  not  sufficiently  great  to  make  the  result  of 
the  struggle  between  rivals  a  foregone  conclusion,  or 
when,  in  the  fourth  place,  the  price  and  quality  alone  de- 
cide in  the  sale  of  goods ;  or  when,  finally,  goods  are  mar- 
keted by  rivals  at  a  price  which  generally  speaking  yields 
a  profit  permitting  of  a  continuance  of  business. 

To  define  competition  as  "  fair "  under  such  circum- 
stances is  to  admit  the  impossibility  of  equalizing  all  facts. 
It  does  not  dictate  an  abandonment  of  the  principle  of 
striving  among  producers  and  consumers,  but  it  hints  at 
limitations  that  in  the  long  run  safeguard  both  competi- 
tor and  the  public. 

Some  sort  of  inequality  and  hence  of  injustice,  as  popu- 
larly understood,  is  bound  to  linger  among  us.  Right 
cannot  be  right  to  all  contending  parties.  Might  always 
exists,  if  by  that  term  we  mean  the  superiority  in  some 
respects  of  force  over  mere  good  will,  or  of  law  over  com- 
mon sense. 

§  4.  Might  versus  Right. —  But  if  we  inspect  the  mat- 
ter of  might  versus  right  more  closely  we  shall  find  that 
might  means  nothing  except  by  reference  to  something 
else.  Might  may  mean  either  muscular  strength  or  me- 
chanical power,  or  such  brain  powers  as  are  exercised  in- 
dividually or  by  dint  of  social  organization.  If  the  force 
is  physical  the  individual  ordinarily  is  the  active  agent, 
as  when  pugilists  settle  a  question  of  superiority.  Na- 
tions also  fight,  though  armies  nowadays  represent  much 
more  than  skill  or  muscle  strength.  In  all  such  cases 
might  may  consist  of  physical  force  only,  and  it  deserves 


THE  LIMITS  OF  SOCIALISM 

mention  that  ultimately  all  other  values  will  stand  or  fall 
according  to  the  issue  of  a  physical  combat. 

But  manifestly  such  struggles  have  nothing  to  do  with 
social  values  unless  we  first  posit  the  latter  as  occasion  for 
the  former.  Might  strictly  speaking  is  right  only  when 
a  predominating  opinion  cannot  be  upheld  by  physical 
force.  In  that  case  our  disappointment  is  voiced  in  the 
remark  that  might  has  triumphed  over  right.  When  ex- 
pert opinion  is  defied,  or  the  will  of  the  majority  is  dis- 
obeyed (particularly  on  the  confession  of  the  offender 
himself)  then  his  exercise  of  physical  power  is  reproved. 

Might  is  right,  therefore,  when  the  majority  sanctions 
the  force  used  to  uphold  its  views,  whether  science  sup- 
ports public  opinion  or  not ;  or  when  in  the  absence  of  any 
social  values  physical  force  alone  governs ;  or  when,  in  the 
third  place,  approved  norms  of  conduct  prevail  indepen- 
dent of  physical  coercion.  In  the  long  run  the  will  of  the 
majority,  however  inspired,  carries  the  day.  Right,  con- 
sequently, must  triumph  as  a  general  rule  even  though  for 
groups  of  people  and  for  limited  periods  of  time  condi- 
tions may  be  at  variance  with  public  opinion. 

The  law  of  approximations  and  of  averages  thus 
equates  the  two  sides  of  right  and  might  for  the  same 
reason  that  it  brings  into  logical  relation  the  fields  of  re- 
ligion and  of  social  science,  or  of  economics  and  of  ethics. 
There  is  no  impassable  gulf  between  socialism  —  even  as 
taught  by  Marx  —  and  the  religious  beliefs.  It  is  not 
necessary  to  oust  competition  from  the  field  of  economic 
endeavor.  But  on  the  other  hand  it  is  doubtful  whether  a 
categorical  exclusion  of  the  collectivistic  standpoint  from 
economic  science  will  further  the  interests  of  economics 
itself.  Justice  must  be  socially  conceived  and  measured. 
Socialism  has  first  called  attention  to  the  need  of  such  a 


JUSTICE  125 

gauging  of  right  and  wrong.  The  future  development  of 
social  science  seems  bound  to  fuse  ethics  and  economics 
into  one  single  problem,  so  that  people  will  more  nearly 
than  at  the  present  be  in  accord  with  scientific  conclusions. 


CHAPTER  VI 
THE  LIMITS  IN  PRODUCTION 

§   i.  National  Income  and  Consumption  of  Goods. — 

TJigjiath-to  progress  is  through  plenty.  There  is  no  way 
in  which  the  condition  of  the  average  man  can  be  bettered 
except  we  raise  his  income  first.  Whatever  the  limita- 
tions of  mere  wealth  may  be,  if  we  have  no  wealth,  if  man- 
kind lives  uncertainly  from  hand  to  mouth,  everything  else 
will  also  be  lacking  that  is  typical  of  a  civilized  state.  All 
history  so  far  has  forced  us  to  take  this  attitude.  Hu- 
man development  from  beginning  to  end  has  been  a  piling 
up  of  economic  goods  the  consumption  of  which  has  been 
accompanied  regularly  by  advances  in  art  and  science, 
in  speculation  and  moral  judgments. 

It  is  then  no  trifle  if  socialism  declares  to  have  found 
a  short  cut  to  wealth.  If  it  is  true  that  national  in- 
come may  be  greatly  increased  by  abolishing  private  prop- 
erty we  should  favor  the  revolution  even  though  it  entail 
much  personal  effort  and  sacrifice.  If,  as  an  eminent 
socialist  leader  avers,  "  the  transformation  of  the  capi- 
talist system  of  production  into  the  socialist  system 
must  inevitably  result  in  a  rapid  increase  of  the  quantity 
of  wealth  produced  "  *  an  important  question  is  happily 
settled.  The  raising  of  the  general  level  of  living  is  the 
concern  of  all  statesmen  and  reformers.  ^Nothing  is  so 
palpably  desirable  as  a  doubling  of  wages,  if  by  it  we  mean 

a  doubling  of  the  average  person's  purchasing  power./ 

—    I.  ,*/ 

1  Kautsky,  K.,  "  Class  Struggle,"  a  running  commentary  on  the 
Erfurt  Program  of  the  German  Sozial-demokratische  Partei,  trans- 
lated by  Bohn,  W.  E.,  p.  145. 

126 


THE  LIMITS  IN  PRODUCTION  127 

Socialism  hopes  to  accomplish  this  miracle  in  two  ways, 
namely  first  by  augmenting  the  national  aggregate  of 
goods,  and  secondly  by  changing  the  ratio  in  which  neces- 
sities and  luxuries  are  now  commonly  turned  out.  The 
first  is  no  doubt  the  more  important  step  in  the  long  run, 
but  the  second  could  be  attempted  at  shorter  notice. 
And  it  deserves  mention  again  that  this  change  is  to  con- 
cern, not  the  monetary  values  in  which  we  now  measure 
wealth,  but  the  latter  itself,  that  is  the  amount  by  weight 
or  volume  of  the  goods  that  enter  into  the  market.  Let 
the  tons  or  quarts  or  cubic  feet  of  consumables  be  doubled 
or  tripled,  that  is  the  proposition  before  us. 

We  may  introduce  the  nature  of  this  problem  by  making 
a  distinction  between  consumables  and  non-consumables 
which  also  figure  in  the  national  dividend. 

People  have  often  referred  to  the  income,  in  dollars 
and  cents,  of  the  American  nation,  with  the  idea  of  show- 
ing how  the  average  man  would  fare  if  the  principle  of 
equality  were  applied.  It  has  been  pointed  out  that,  on 
such  a  basis,  the  laborer  would  have  perhaps  twice  as 
much  as  he  enjoys  to-day.  If  the  total  national  income 
in  1918,  for  instance,  amounted  to  $75,000,000,000  and 
we  assume  a  population  of  one  hundred  million,  then  the 
per  capita  income  averaged  $750.  For  a  family  of  five 
that  would  mean  $3,750,  a  sum  certainly  not  earned  by 
most  families,  though  enormously  below  what  the  richest 
can  boast  of. 

Such  a  view,  however,  is  from  the  very  outset  mislead- 
ing because  a  nation's  total  annual  output  of  goods  is  not 
so  to  be  divided.  There  are  three  kinds  of  funds  to  be 
taken  into  consideration,  only  one  of  which  becomes  avail- 
able for  personal  use.  ^PfeeJIcstJs  the  fund  needed  to  re- 
place capital  goods  worn  out  in  the  process  of  production, 
or  otherwise  subject  to  deterioration.  The  second  is  our 


128  THE  LIMITS  OF  SOCIALISM 

savings  fund  which  normally  swells  our  national  wealth 
and  makes  industrial  growth  as  well  as  a  rising  level  of 
living,  that  is  a  rising  fund  of  consumables,  possible. 
Ajid  the  third  onljk. namely  the  consumables  just  alluded 
to,  constitute  the  real  income  which  people  have  in  mind 
when  wishing  for  greater  riches.  A  loaf  of  bread  is  part 
of  my  consumables.  The  service  rendered  by  actors 
whose  art  I  see  displayed  on  the  moving  picture  screen 
is  another  such  item  of  income  for  personal  use.  Many 
properties  held  by  governments,  though  used  collectively, 
serve  the  same  purpose. 

But  the  replacing  of  capital  used  in  the  production  of 
consumables  does  not  gratify  me  in  the  same  sense,  nor 
is  the  surplus  devoted  to  the  enlargement  of  capital  a 
genuine  part  of  my  income.  They  are  merely  means  to 
an  end  which,  at  last  analysis,  is  national  development. 
The  relative  size  of  the  shares  varies  with  the  economic 
resources  of  the  country,  with  its  stage  of  economic  de- 
velopment, growth  of  population,  habits  of  living,  etc. 
A  land  richly  endowed  with  resources  can  evidently  main- 
tain a  high  level  of  living  and  yet  set  aside  a  large  sur- 
plus. A  country  poor  in  resources  may  save  a  relatively 
large  portion  of  the  total  income  by  consuming  little. 
Frugal  habits  may  lead  either  to  a  rapidly  growing  popu- 
lation, or  to  the  accumulation  of  an  investment  fund 
which  may  be  placed  either  abroad  or  at  home.  If  re- 
sources are  lacking  it  is  not  likely  that  the  surplus  will 
be  large,  nor  that  it  finds  employment  at  home.  In  gen- 
eral the  surplus  is  the  larger  the  greater  the  total  na- 
tional income,  and  the  replacement  fund  will  grow  of 
course  more  or  less  proportionate  to  the  growth  of  in- 
vestments. In  "  young "  countries  where  resources  are 
plentiful  and  labor  scarce  the  level  of  living  will  be  high 
if  reckoned  by  foodstuffs,  but  low  by  other  standards. 


THE  LIMITS  IN  PRODUCTION  129 

Capital  will  be  imported,  that  is  machinery  and  ideas  will 
be  bought  at  a  high  interest  rate.  The  interest  will  be 
paid  in  rawstuffs  and  rights  to  natural  resources,  or  the 
payment  will  be  postponed  until  suitable  consumption 
goods  can  be  added  to  the  export  of  raw  materials.  In 
such  countries  the  investment  fund  will  grow  more  rapidly 
than  the  flow  of  consumers'  goods,  while  advanced  stages 
of  economic  development  usually  mean  a  relatively  large 
fundof  consumption  goods.  Legislation,  however,  may 
regulate  the  ratios  somewhat  so  as  to  promote  the  in- 
terests of  the  largest  number.  It  is  possible  to  neglect 
the  cultivation  of  the  soil  in  an  endeavor  to  multiply  in- 
dustrial goods  or  personal  services.  In  the  United  States 
the  recent  trend  has  been  toward  a  rapid  industrializa- 
tion of  capital.  The  farmer  received  probably  less  than 
his  share.  The  consumer  consequently  could  not  keep 
as  good  a  table  as  formerly,  though  he  gained  in  other 
directions.  It  is  for  the  government  or  the  individual 
to  decide  which  is  th^moye  preferable/  cheap  food  or  a 
variety  of  industrial  goods  ancTbT services. 

Socialism  will  no  doubt  decide  in  favor  of  foods  before 
investing  heavily  in  the  industries.  The  aim  of  socialists 
is  to  raisethe  income  of  the  poor.  If  then  —  to  return 
to  our  little  problem  —  we  must  deduct  some  fifteen  bil- 
lion dollars  a  year  for  replacing  worn  out  capital  and 
expanding  business  we  get  instead  of  $750  per  capita 
only  $600  annually  in  consumables.  To  raise  this,  so 
that  the  masses  will  have  what  ten  per  cent,  now  get, 
means  not  only  to  increase  the  national  aggregate,  but . 
jajsojbochange  tne  ratios  of  investment,  replacements,  and 
consumption  Tunds  irT"  some  measure.  This  socialism 
hopes  to  do.  It  will  try  to  better  conditions  by  substitut- 
ing necessities  for  luxuries  as  well  as  by  adding  to  the 
total. 


130  THE  LIMITS  OF  SOCIALISM 

§  2.  What  Determines  National  Income — Now  pro- 
duction depends  on  three  factors,  namely,  on  natural  re- 
sources, labor-supply,  and  efficiency.  It  is  by  whatever 
changes  will  occur  in  these  factors  that  socialism  will  bring 
about  the  betterment  of  income.  If  it  can  add  to  our  re- 
sources, if  it  can  increase  the  stock  of  labor-power  either 
by  adding  to  the  number  of  workers  or  by  lengthening  the 
work-day,  and  if  in  the  third  place  it  can  make  men  more 
proficient,  whether  as  individuals  or  as  cogs  in  a  great  in- 
dustrial machine,  then  its  promises  of  a  higher  level  of 
living  may  be  fulfilled.  If  not,  the  promises  can  mean 
nothing. 

The  answer  to  our  question  is  not,  however,  easily 
given,  for  the  data  at  hand  are  extremely  limited  and  not 
always  reliable.  It  is  only  with  reference  to  the  labor 
supply  that  our  information  is  approximately  correct. 
Possible  gains  or  losses  in  social  efficiency  cannot  be  de- 
duced directly  from  statistics  on  education  or  health  or 
socialistic  programs,  and  the  effect  of  socialism  on  natural 
resources  can  be  stated  only  negatively. 

It  is  certain  that  socialism  cannot  produce  natural  re- 
sources. It  can  only  look  for  them  and  then  use  them. 
But  since  socialists  have  not  claimed  a  greater  ability  in 
locating  resources  than  our  experts  possess  now  the  chief 
question  is  that  of  using  them. 

The  producer  distinguishes  between  physically  existent 
resources  and  those  he  can  exploit  at  prevailing  prices. 
He  will  not  work  a  mine  if  the  vein  is  too  thin  or  the  ore 
of  low  yield.  He  will  keep  his  property  but  wait  for 
rising  prices.  When  demand  has  increased  and  prices 
rise  faster  than  expenses  he  is  likely  to  reach  for  his 
reserve  stocks.  He  will  work  less  rich  tracts  of  land  or 
deposits  of  coal  and  ore  if  he  has  to,  provided  his  own 
profits  are  not  diminished  materially.  This  principle  of 


THE  LIMITS  IN  PRODUCTION  131 

diminishing  returns  governs  all  production  and  is  re- 
spected by  socialists. 

On  the  other  hand  they  urge  that  much  land  and  other 
riches  are  withheld  that  should  be  used  now.  They  argue 
that  to  increase  these  stores  is  part  of  their  program,  and 
that  they  will  enlarge  our  resources  in  the  sense  that  they 
will  not  wait  for  profits  as  the  capitalist  undoubtedly 
does.  Let  us  grant  the  proposition  and  add  temporarily 
ten  per  cent,  to  our  productive  power  by  this  route.  Yet 
it  deserves  noting  that  the  gain  will  be  only  temporary. 
For  competitive  principles  will  make  an  end  of  specula- 
tive reservations  sooner  or  later.  In  Europe  the  idea  of 
^  waste  through  disuse  could  hardly  come  in  question.  In 
thlPTJmtect  states,  indeed 'throughout  the  world,  the 
tendency  is  steadily  toward  exploitation  of  what  is  in 
sight.  Either,  therefore,  the  gain  has  been  of  brief  dura- 
tion or  we  face  the  still  less  pleasant  fact  that  we  may 
hasten  development  unnecessarily. 

Socialism  deals  with  long  stretches  of  time.  It  is  not 
interested  merely  in  the  immediate  future.  It  will  not 
care,  therefore,  to  raise  our  level  of  living  by  working 
resources  at  maximum  speed,  if  as  a  result  of  this  policy 
the  stock  is  exhausted  the  sooner.  Yet  this  has  happened 
before,  and  may  happen  again.  The  world's  mineral 
stocks,  notably,  are  only  theoretically  inexhaustible. 
They  appear  endless  when  they  are  not.  It  is  not  ad- 
visable to  use  them  up  prodigally  when  we  know  that  they 
are  unreplaceable.  Substitutes  cannot  always  be  found. 
The  depletion  of  our  natural  stores  is  a  piece  of  folly 
that  no  one  will  encourage,  socialists  least  of  all.  To 
have  a  nation  grow  rapidly  is  a  questionable  advantage, 
since  the  law  of  decreasing  returns  obtains  everywhere. 
It  is  possible  to  develop  power  and  prestige  at  the  expense 
of  posterity.  To  skim  from  the  top  has  been  a  tempta- 


132  THE  LIMITS  OF  SOCIALISM 

tion  for  many  settlers  of  virgin  lands  with  riches  beck- 
oning on  all  sides,  but  ere  long  the  exploiting  nation  pays 
the  penalty.  Socialism,  precisely  because  it  sees  far 
ahead,  will  discountenance  ruthless  exploitation  and  will 
husband  our  resource?. 

A  gain  in  natural  resources  is  therefore  not  well  pos- 
sible. If  income  is  to  be  raised  4t-.will  be  by.  changes  jn 
labor  supply  and  its  efficiency. 

|  3.  Effects  of  Age  Distribution  on  Production. —  But 
before  passing  to  a  consideration  of  such  changes  in  the 
amount  of  labor-power  which  socialism  may  bring  about, 
let  us  see  what  important  features  of  population  social- 
ism cannot  directly,  nor  perhaps  indirectly,  affect.  It 
will  teach  us  to  appreciate  the  uncontrollable  factor  in 
population,  while  otherwise  we  might  exaggerate  the 
powers  of  socialism. 

Different  populations  show  very  different  distributions 
of  age,  and  this  is  important  because  not  all  ages  are 
equally  productive.  Rather,  we  may  divide  life  into  sev- 
eral periods  according  to  their  economic  productiveness. 
The  first  ten  years,  e.  g.,  represent  a  clear  loss,  for  at  this 
time  the  child  consumes  without  producing  anything.  In 
the  second  period,  say  from  the  tenth  to  the  twentieth 
year,  it  begins  to  produce,  but  less  than  it  consumes. 
There  are  of  course  exceptions,  and  besides  it  is  difficult 
to  rate  productivity  as  soon  as  we  refer  to  values-in-ex- 
change. But  roughly  a  balance  between  income  and  out- 
go, between  what  is  produced  and  what  is  consumed,  may 
be  struck.  Let  us  then  call  the  third  period  from  twenty 
to  sixty  or  seventy  years  the  most  valuable  for  the  nation. 
In  these  years  the  average  man  produces  more  than  he 
consumes,  and  certainly  much  more  than  the  biologically 
necessary  things.  He  raises  his  income  by  raising  his 
productiveness.  It  is  the  time  of  rearing  children  and 


THE  LIMITS  IN  PRODUCTION 


laying  aside  savings  for  a  rainy  day.  Production  some- 
where between  thirty  and  sixty  years  of  age  is  at  top- 
notch.  After  the  sixtieth  or  seventieth  year  we  note  a 


TABLE  Two 

AGE  DISTRIBUTION  IK  THE  POPULATION  OF  DIFFERENT  COUNTRIES  IN 

1910 

(Distribution  in  Percentages  of  the  Total  Population) 
Countries 


Ger- 

Austra-   United 

Age  Periods 

U.S.A. 

France 

many 

Austria 

lia 

Kingdom 

1-10  Years 

.  .  .22.2% 

17.2% 

23.1% 

26.3% 

41.1% 

20.7% 

10-20  Years 

...19.8% 

16.6% 

20.3% 

20    % 

19    % 

20-30  Years 

.7.  18.7% 

15.9% 

16.3% 

15.4% 

32    % 

8.9% 

30-40  Years 

.,,,14.6% 

14.8% 

15.2% 

12.6% 

16.1% 

40-50  Years 

...10.6% 

13.6% 

10.2% 

10.5% 

18.8% 

13.3% 

50-60  Years 

...   7.2% 

10.5% 

7.7% 

7.7% 

9.7% 

Over  Sixty 

Years 

69% 

12.4% 

7.2% 

7.5% 

7.7% 

6.4% 

Total  Population                                                                                "•'/•/ 

in  Millions 

...92 

39.2 

65 

28.5 

4.45 

45.4 

Note:  Age-Periods  for  the  United  Kingdom  are  the  following: 
One  to  Ten  Years;  Ten  to  Twenty  Years;  Twenty  to  Twenty-Five 
Years;  Twenty-Five  to  Thirty-Five  Years;  Thirty-Five  to  Forty- 
Five  Years;  Forty-Five  to  Fifty- Five  Years;  Fifty-Five  to  Sixty- 
Five  Years;  Over  Sixty-Five  Years. 

Reference:  Statistical  Yearbooks  of  United  States,  France,  Ger- 
many, Austria,  Australia,  United  Kingdom. 


decline.  The  curve  of  productiveness  falls  visibly.  Man 
once  more  becomes  a  deficit  producer  and  eventually  de- 
pends entirely  upon  others  for  his  living.  But  consump- 
tion of  course  drops  off  also. 

Now  Table  Two  is  designed  to  show  some  striking  dif- 
ferences between  such  powers  as  the  United  States  and 
Germany,  and  smaller  nations  like  France  or  Austria 
on  the  other  hand.  The  size  of  the  population  is  not 
however  the  point  in  question.  Rather,  it  is  the  effect 


134  THE  LIMITS  OF  SOCIALISM 

of  net  birth-rates  and  of  migration.  It  will  be  noted  that 
the  first  two  nations  mentioned  boast  a  large  percentage 
of  young  ages,  while  their  proportion  of  advanced  ages 
is  relatively  small.  In  the  United  States  immigration  was 
always  a  dominant  factor.  In  Germany  the  natural  in- 
crease counts  most  up  to  1900,  and  after  that  decreas- 
ingly  so,  while  immigration  increases.  The  period  of 
twenty  to  forty  years  is  well  represented  in  both  countries. 
Labor  is  cheap  relative  to  resources,  and  there's  enough 
to  make  rapid  internal  development  possible.  /Powers 
grow  great  and  rich  when  the  demographic  pyramid 
bulges  at  the  bottom  and  is  contracted  at  the  top,  for  then 
the  surplus  producers  or,  from  a  given  time  standpoint, 
the  prospective  surplus  producers  provide  an  ample  in- 
vestment funcT)  The  condition  of  France  and  Austria 
is  serious.  France  suffered  most  through  a  decline  of  the 
birth-rate;  Austria  through  emigration.  Her  best  men 
left  in  the  prime  of  manhood.  No  nation  can  easily  off- 
set such  a  drain. 

There  is  no  need  of  developing  further  this  point.  The 
differences  of  age  distribution  are  sufficiently  wellknown, 
but  they  are  recalled  here  as  significant  by  comparison 
with  such  changes  in  the  labor-supply  as  socialism  may 
at  will  bring  about.  The  factors  not  so  controllable  in- 
fluence the  supply  at  least  as  much,  and  possibly  more. 

|  4.  Possible  Increase  of  the  Labor  Supply. —  The 
possibilities  of  socialistic  readjustment  are  tabulated  in 
Table  Three.  The  estimate  is  of  course  only  a  rough  one, 
for  statistics  are  not  always  on  a  strictly  comparative 
basis.  There  is  plenty  of  room  for  error.  Classifica- 
tions do  not  correspond  exactly,  and  the  statistical  serv- 
ice is  not  for  all  countries  equally  reliable  and  complete. 
But  so  far  as  the  numerical  changes  in  the  labor  supply 
are  concerned  the  appended  table  is  suggestive.  It  shows 


THE  LIMITS  IN  PRODUCTION 


135 


TABLE  THREE 

Possible  Changes  in  the  Labor  Supply  of  the   United 

States  for  the  Year  1910,  according  to  Socialistic 

Standards 

(References:    Thirteenth    Census    of    the    United    States,    Census 
Bureau,  Volumes  on  Population  and  on  Occupations.) 

A.     NUMBER  OF  GAINFULLY  OCCUPIED  AND  NON-OCCUPIED  IN  1910 
(Millions  omitted) 

Total   population    92 

Gainfully  occupied    38.2 

Not  gainfully  occupied   53.8 

Of  these  were: 

Married  women   16.1 

Children  under  20  years 31.2 

Females  over  65  years 2.1 

Males  over  70  years 1.1 

Youths  attending  school 
over  20  years  of  age 0.6^ 

Widows  under  65  years 1.6 

Inmates  of  benevolent  in- 
stitutions    0.6 

Inmates  of  prisons 0.1 

Idle  rich,  etc 0.4 


after     deduction 
occupied. 


of     gainfully 


B.     CHANGES  IN   LABOR   SUPPLY   CONFORMING  TO   SOCIALISTIC 
STANDARDS 


(Millions  omitted) 


Losses 


1.  Abolition  of  work  for 
children  under  20. 
(Count  their  efficiency 
at  one-half)  3.7 


2.  Pensions  for  all  over  60. 
(Count  four-fifths  of  all 
males,  and  one-half  of 
females  over  60  as  gain- 
fully occupied  in  1910) .  4.1 


Gains 


1.  Industrial      employment 
of    married    women    un- 
der   60    years    of    age. 
(Count  their  present  ef- 
ficiency     as     two-thirds 
that     developed     under 
socialism)    4.8 

2.  Employment   of    all   be- 
tween 20   and   60   years 
of  age  not  gainfully  oc- 
cupied in   1910    (except- 
ing disabled,  etc.)    2.1 


136 


THE  LIMITS  OF  SOCIALISM 


Losses 


Gross  loss 7.8 

In  per  cent,  of  gainfully 

occupied    20.4% 

3.  Loss  through  reduction 
of  work  hours  per 
week  20  % 

Total  gross  loss  in  per- 
centages   40.4% 


Gains 

3.  Reduction  of  involun- 
tary unemployment,  ex- 
cept through  illness ....  0.6 


Gross  gain   7.5 

In  per  cent,  of  gainfully 

occupied    19.6% 

4.  Gain  through  educa- 
tional extension,  etc., 
say  25  % 


Total  gross  gain 44.6% 

Deducting  gross  loss.  .40.4% 


Net  gain 

Allow  for  errors,  giving  so- 
cialism the  benefit  of 
the  doubt  .  ..10 


Final  net  gain  possible 14.2% 

that  more  than  a  ten  or  fifteen  per  cent,  gain,  even  when 
we  speculate  on  the  effects  of  education,  should  not  be  ex- 
pected by  socialists.  The  losses  incident  to  the  introduc- 
tion of  socialistic  ideals  almost  counterbalance  the  gains. 

If  we  figure  the  possible  gains  and  losses  for  the  United 
States  on  the  basis  of  occupation  statistics  for  1910  the 
account  would  run  about  as  follows. 

The  population  of  the  United  States  in  1910  was 
ninety-two  million.  Of  these  slightly  over  thirty-eight 
million  were  gainfully  occupied.  That  is,  they  supported 
themselves  entirely  or  mainly  by  their  own  earnings,  the 
remainder  of  the  population  depending  upon  them  for  a 
living.  The  majority  thus  was  not  gainfully  occupied 
officially,  though  many  of  them  doubtless  helped  to  pro- 
duce values  sold  in  the  open  market.  In  addition,  we 
note,  there  were  nearly  eighteen  million  married  women 
exclusively  of  those  gainfully  occupied,  plus  the  following 


THE  LIMITS  IN  PRODUCTION  137 

non-producers  who  earned  neither  money  nor  otherwise 
contributed  directly  to  the  nation's  fund  of  utilities. 
Namely,  we  have  first  all  children  under  twenty  years  of 
age,  of  whom  there  were  thirty  million ;  secondly  the  aged 
who  account  for  three  million,  third,  young  men  and 
women  attending  educational  institutions,  fourth,  widows 
not  gainfully  occupied  but  less  than  sixty-five  years  of 
age,  and  finally  such  other  groups  as  criminals,  cripples, 
and  the  idle  rich.  The  classification  will  point  out  which 
of  these  several  classes  are  available  for  industrial  em- 
ployment, and  which  are  not. 

Socialism  hopes  to  gain  most  by  industrializing  the 
work  of  women.  ^The  abolition  of  the  home  is  understood. 
by_most  socialists  in  this  sense.  It  is  not  that  they  wish 
to  break  up"fne  personal  relation  between  the  married  and 
their  offspring,  but  that  they  advocate  the  consolidation 
of  homes  into  larger  units  of  social  life,  or  if  not  that,  the 
"conversion  of  individual  work  into  team  work  so  that  un- 
necessary duplication  and  waste  may  be  minimized.  It  is 
difficult  to  decide  just  what  socialists  propose  to  do,  as 
current  events  in  Russia  show.  But  it  seems  best  to  grant 
socialists  a  gain  of  one-third  by  their  new  methods  of 
utilizingjemale  labor.  The  question  of  home  ties  and 
legal  relations  may  then  be  ignored  entirely.  It  will  be 
noted  however  that  the  gain  refers  only  to  women  not  now 
industrially  employed,  and  then  only  to  those  under  sixty 
years  of  age*_ — - — 

This  second  restriction  of  age  follows  from  the  social- 
istic norm  of  leisure.  An  organic  law  of  the  Russian- 
Socialist  Federal  Soviet  Republic,  e.  g.,  has  classified  men 
nypr  sivfy  «.nrl  wrnnpn  nvpr  fifty  years  of  ape  as  unable 

jo  work., [Jo  these  age  groups  it  grants  a  pension,  and 

expects  no  work  except  it  be  voluntarily  done  —  which  it 
doubtless  often  is.  It  seems  not  unreasonable  to  figure 


138  THE  LIMITS  OF  SOCIALISM 

on  a  loss,  therefore,  in  our  calculation  of  all  over  sixty 
who  are  now  gainfully  occupied  or  working  as  wives  and 
mothers.  If  we  count  them  as  normally  efficient  this 
means  a  loss  of  over  four  million  workers. 

But  to  return  to  the  sources  of  gain.  There  is  in  the 
second  place,  the  employment  under  socialism  of  all  be- 
tween twenty  and  sixty  years  of  age  —  on  our  supposi- 
tion that  pensions  begin  with  the  sixtieth  year.  No 
professional  loafers  will  be  tolerated.  Wealth  will  be 
no  excuse  for  idleness,  and  aversion  to  work  no  passport 
for  tramps.  A  great  many  widows  under  sixty  years 
of  age  that  now  live  on  their  income  will  go  to  work,  too ; 
and  perhaps  some  of  those  now  attending  school  will  not 
do  so  after  socialism  has  improved  the  lower  school  system. 
The  total  gain  thus  will  amount  to  over  two  million,  as 
indicated  in  the  Table. 

But  this~is"  not  all.  In  the  third  place  unemployment 
may  be  materially  reduced.  In  1910  about  one-half  mil- 
lion men  and  women  were  out  of  work  throughout  the 
year.  In  some  years  the  loss  is  still  greater,  in  others 
much  smaller.  It  is  a  debatable  point  indeed  whether 
socialism  will  improve  the  productive  organization  enough 
to  eliminate  all  this  waste.  Not  many  will  agree  that 
it  can  be  done.  But  in  order  to  make  the  argument  as 
strong  as  possible  we  may  for  the  moment  grant  the  ad- 
justment of  supply  to  demand  in  goods  and  labor  that 
socialists  demand.  An  improvement  is  certainly  desir- 
able, and,  what  is  more  to  the  point,  seems  practicable. 

This  leaves  us,  in  the  fourth  pla£ejL_a__gain_diie_to— edu- 
cation.  In  allowing  for  this  change  we  are  passing  from 
purely  quantitative  to  qualitative  aspects  of  the  labor- 
supply.  It  is  not  certain  that  any  kind  of  estimate  is 
worth  while,  since  efficiency  depends  on  so  much  else  be- 
sides technical  training.  But  as  a  rule  an  advancement  of 


THE  LIMITS  IN  PRODUCTION 

learning  must  be  held  to  have  perceptible  effects.  The 
gain  should  be  real,  and  in  excess  of  what  prevailing  con- 
ditions will  lead  to.  Hence  a  25%  addition  to  the  gains 
already  registered  is  proposed  in  the  Table. 

If  now  we  turn  to  the  loss  we  have  first  the  effect  of 
protection  for  old  age,  which  was  referred  to  above,  and 
secondly  the  shrinkage  of  labor-power  due  to  a  prohibi- 
tion of  child  labor.  One  of  the  most  fundamental  assets 
of  the  socialistic  doctrine  is  its  educational  program. 
Knowledge  is  to  be  popularized  and  made  free.  The 
average  man  will  have  a  chance  to  learn  and  think  as  he 
has  not  had  heretofore.  Technical  instruction  and  a  lib- 
eral education  in  the  arts  and  social  inquiries  will  develop 
the  mind,  .while  recreation  and  hygiene  will  develop  the 
body.  (  Without  education  leisure  means  little,  and  with- 
out leisure  education  is  impossible.  The  abolition  of  child 
labor  has  thus  several  motivesr~Ji  looks  to  the  intel- 
lectual uplift  of  the  masses,  and  it  aims  at  health  and 
vigor.  The  dissemination  of  knowledge  is  only  to  be  ac- 
companied by  a  greater  regard  for  physical  welfare. 

Just  at  what  age  industrial  employment  is  to  begin  we 
cannot  tell.  It  has  been  urged  that  all  youths  should 
have  a  college  education,  in  which  case  the  period  of 
leisure  would  have  to  be  extended  to  the  twenty-second 
year.  Others  have  been  content  to  stop  at  fifteen.  But 
in  as  much  as  the  present  common  school  education  is 
found  so  woefully  wanting  by  all  parties,  even  though  it 
includes  eight  years  of  training^jt  seems  proper  to  credit 
the  socialistic  scheme  with  an  extension  of  schooling  at 
least  up  to  the  twentieth  yearT)  The  less  it  approaches 
this  goal  the  weaker  its  argument,  and  the  smaller  of 
course  the  gain  in  productiveness  which  we  have  already 
put  on  the  right  side  of  the  ledger. 

If  then  we  combine  these  two  reductions  in  labor  sup- 


140  THE  LIMITS  OF  SOCIALISM 

ply  we  have  a  total  of  seven  million  eight  hundred  thou- 
sand, against  which  must  be  set  a  gain  of  seven  million 
five  hundred  thousand.  This  leaves  a  net  preliminary  loss 
of  three  hundred  thousand  workers.  However,  the  gain 
in  efficiency,  which  was  rated  at  25%,  more  than  counter- 
balances it.  A  loss  of  three  hundred  thousand  workers 
equals  not  quite  one  per  cent,  of  the  total  number  of  gain- 
fully occupied  who,  it  will  be  remembered,  made  up  about 
thirty-eight  million  out  of  a  total  population  of  ninety- 
two  million.  Deduct  this  loss  of  0.8%  from  a  gain  of 
25%  and  you  obtain  an  apparent  net  gain  of  24.2%. 

But  the  gain  is  apparent  only.  For  in  the  third  place 
socialism  loses  by  curtailing  the  number  of  work-hours 
per  day,  week,  and  year.  In  1918  the  standard  day  had 
about  eight  hours.  Yet  many  millions  worked  ten  hours 
a  day  or  over.  In  1910  the  eight  hour  schedule  was  still 
the  exception  rather  than  the  rule.  Under  socialism  it 
may  be  the  rule  at  first,  but  the  avowed  intention  of  all 
socialists  is  the  reduction  of  labor-hours  proportionate  to 
technical  advance.  The  more  machinery  displaces  the 
hand,  and  the  greater  the  output  of  goods  per  hour  or 
month,  the  shorter  the  work  day.  This  is  the  slogan 
with  which  socialists  fight.  It  is  logical  in  a  way,  and 
should  serve  to  benefit  the  carefree  masses./  But  the  loss 
counts  and  means  a  shrinkage  of  goods,  that  is,  not  an 
absolute  shrinkage,  but  one  relative  to  maximum  possi- 
bilities, or  to  what  is  now  being  done. -If  we  take  an 
average  weekly  schedule  of  fifty  hours,  and  clip  off  one- 
fifth,  we  lose  in  commodities  what  we  gain  in  freedom. 
Socialism  is  willing  apparently  to  reckon  with  six  or  seven 
hours  of  work  a  day,  and  so  our  deduction  of  20%  is 
Ifair. 

We  conclude  then  that  nominally  the  gain  in  labor- 
power  is  less  than  5%.  However,  as  remarked,  there  is 


THE  LIMITS  IN  PRODUCTION  141 

no  need  of  sticking  too  closely  to  our  figures,  since  there 
is  so  much  chance  for  error.  Let  us,  therefore,  return 
to  our  first  announced  gain  of  ten  to  fifteen  per  cent., 
which  would  be  a  maximum  compatible  with  the  ideals  of 
socialism.  More  than  that  it  cannot  look  forward  to 
without  becoming  untrue  to  its  own  professions. 

|  5.  Possible  Economy  in  Technical  Organization. — 
There  remain  thus  for  brief  consideration  two  other  sets 
of  facts,  namely,  first  the  continuance  of  disagreeable 
types  of  labor,  and  secondly  certain  savings  due  to  or- 
ganization such  as  socialism  hopes  to  perfect. 

Irksome  and  dirty  work  will  always  have  to  be  done, 
for  as  fast  as  machines  in  one  place  relieve  men  of  it, 
needs  in  another  place  reintroduce  it.  It  is  likely  that 
in  the  future  occupational  diseases  and  accidents  will  al- 
most entirely  disappear.  Science  increasingly  finds  means 
for  protecting  the  laborer  against  the  poisons  amidst 
which  he  plies  his  trade.  Safety  devices  will  be  multi- 
plied and  employees  properly  taught  the  use  of  machines. 
Ignorance,  carelessness,  and  fatigue  have  been  found  to 
be  the  most  common  sources  of  fatal  accidents.  Social- 
ism is  no  doubt  right  if  it  claims  that  the  perils  of  work 
can  be  largely  eliminated  by  right  precautionary 
measures.  But  this  is  not  doing  away  with  crude  labor 
as  such. 

Disagreeable  labor  will  always  have  to  be  done  because 
man's  wants  are  never  completely  satisfied.  There's 
always  something  to  attend  to,  to  invent  and  to  produce. 
As  fast  as  men  are  displaced  by  one  machine  they  find 
employment  in  some  other  quarter.  Crude  labor  means 
energy,  and  a  certain  amount  of  human  muscular  energy 
is  an  indispensable  part  of  the  productive  organization. 
The  ratio  between  rough  work  and  the  more  refined,  be- 
tween manual  labor  and  machino-facture,  technical 


THE  LIMITS  OF  SOCIALISM 

progress  cannot  materially  change.  In  the  Census 
figures  for  1910  crude  labor  is  just  about  as  prominent 
numerically  as  twenty  or  thirty  years  earlier.  There  is 
no  perceptible  decline  of  unskilled  occupations  or  of  hard 
work  in  the  building  trades,  in  engineering,  mining  and 
farming.  Machines  liberate  labor  for  less  essential  uses, 
but  they  do  not  end  cheerless  toil.  If  socialism  then 

TABLE  FOUR 
Industries  With  Small-Scale  Production  (U.  £.,  1910) 

Per  cent,  of  Wage-Earners 
in  Establishments  Employing 

Industries  No  Wage-Earners,  or 

Less  than  Twenty  (20) 

Bakery  products  75% 

Butter,  cheese,  and  milk 80% 

Canning  and  preserving 31% 

Carriage  and  wagons    40% 

Cooperage   31% 

Flour  mill  products  82% 

Unspecified  food  preparations  40% 

Fur  goods  57% 

Manufactured  ice  65% 

Leather  goods   32% 

Marble  works    34% 

Mattresses  and  beds  43% 

Mineral  and  soda  waters  99% 

Cottonseed  oil   34% 

Patent  medicines    62% 

Printing     58% 

Tobacco  manufactures    52% 

Carved  wood    45% 

Reference:    Thirteenth  Census,  1910,  V.  8,  Manufactures,  P.  186, 
U.  S.  Bureau  of  Census. 

wishes  to  relieve  the  masses  in  this  respect,  it  will  have  to 
alternate  types  of  work  for  given  individuals,  or  else  take 
the  sting  out  of  the  most  dreaded  kinds  of  labor  by  pay- 
ing extra  wages. 


THE  LIMITS  IN  PRODUCTION  143 

This  would  of  course  mean  some  impairment  of  social 
efficiency,  but  it  might  be  worth  while  nonetheless.  Be- 
sides, there  is  some  room  for  economy  in  another  field, 
namely  in  the  organization  of  capital  and  labor  forces. 
Socialists  commonly  dwell  on  this  possibility  and  point  to 
the  immense  loss  now  incurred  by  the  public  due  to  over- 
production, to  unnecessary  duplication  of  plant,  small- 
scale  output,  and  extravagance  in  the  use  of  machinery 
as  well  as  of  consumption  goods. 

The  first  kind  of  waste  is  of  course  attributed  to  the 
lack  of  correlation  between  demand  and  supply,  and  is 
therefore  a  distributive  problem  which  connects  closely 
with  the  problem  of  income,  of  which  more  hereafter. 

Waste  through  useless  duplication  of  effort  and  wealth 
results   naturally   from   the   individualistic   principle   and 
cannot  be  altogether  avoided  until  the  entire  nation   is 
treated  as  one  market  for  one  single  producer,  the  gov- 
ernment acting  on  behalf  of  the  people.     At  the  present 
an   enterpriser  is   chiefly   influenced  by   personal   consid- 
erations.    He    will   be    willing    to    invest    funds    if    they 
promise  returns,  even  though  the  waste  for  the  consuming 
public     is     perfectly     apparent.     Railroads,     telephones, 
street    car   lines,    ships    and   pikes,    factories    and    office 
buildings  have  been  needlessly  duplicated  in  this  manner. 
I    The  waste  occasionally  has  raised  a  storm  of  protest,  but 
1    usually  the  charge  upon  the  consumer  has  been  borne  with 
V^equanimity,  as  a  sort  of  toll  levied  by  Dame  Liberty^; 

Socialism  proposes  to  substitute  a  collectivistic  prin- 
ciple for  the  competitive,  and  thus  to  end  the  drain  on 
national  resources  that  selfish  duplication  entails.  It 
hopes  to  effect  a  noticeable  saving  by  a  better  disposition 
of  labor  forces,  and  it  seems  reasonable  to  grant  it  all 
the  credit  that  such  a  change  may  give  the  consumer. 
The  policy  of  consolidation,  however,  not  merely  leads 


144  THE  LIMITS  OF  SOCIALISM 

to  a  reduction  of  waste,  it  also  is  believed  by  some  to  lower 
costs  on  the  principle  that  rates  of  return  rise  with  in- 
crease of  the  scale  of  production. 

In  the  United  States  in  1910  there  were  still  a  good 
many  industries  in  which  the  number  of  .employees  per 
plant  was  less  than  twenty.  Indeed,  in  many  of  them  it 
was  less  than  ten.  Table  Four  shows  typical  instances  of 
such  small  scale  production.  Three  quarters  of  the 
bakeries,  it  will  be  seen,  employed  less  than  twenty  work- 
ers. In  the  soda  water  production  the  percentage  is 
highest,  and  creameries  come  next.  Goods  in  these  in- 
dustries may  be  said  to  be  produced  on  a  small  scale,  but 
whether  this  means  waste  is  another  question.  It  is 
probable  that  the  manufacturer  has  adjusted  himself  to 
the  competitive  conditions  surrounding  him  and  either 
cannot  extend  his  business  greatly,  or  else  is  tending  in 
that  direction  without  our  noticing  it  at  once.  A  bakery, 
for  instance,  is  no  longer  a  one-man  affair.  Machines 
have  largely  displaced  manual  labor.  Some  concerns  sup- 
ply many  thousands  of  customers  each  day.  The  man 
who  once  had  only  one  or  two  apprentices  now  employs 
ten  or  fifteen,  installing  machinery  which  gives  him  the 
largest  return  in  profits.  He  has  enlarged  his  scale  of 
production,  but  it  seems  small  compared  to  the  methods 
used  in  iron  and  steel,  or  in  mining. 

The  general  answer  is,  however,  the  old  one.  Namely, 
fine  work  will  always  be  in  demand.  There  are  crafts 
that  call  for  high  personal  skill,  individuality,  and  ex- 
treme care  in  workmanship.  For  such  products  large- 
scale  production  is  out  of  the  question.  Their  existence 
is  simply  evidence  of  wealth  and  high  prices  paid  for 
special  quality.  Socialism  will  make  an  end,  possibly, 
of  some  of  these  industries,  but  this  gain  of  labor-power 
for  uses  elsewhere  is  a  detail. 


THE  LIMITS  IN  PRODUCTION  145 

On  the  other  hand,  if  scrapping  of  machinery  and  of 
labor  which  now  is  carried  on  extravagantly  can  be 
stopped  by  collectivistic  norms  of  valuation,  a  notable 
saving  will  be  effected.  It  has  been  freely  admitted  by 
magnates  of  business  that  the  competitive  struggle  in- 
volves a  large  waste  through  rapid  obsolescence  of  capital 
goods.  A  slight  improvement  may  lead  to  the  abandon- 
ment of  an  old  process  and  of  the  tools  going  with  it. 
The  fear  of  a  competitor  who  may  himself  introduce  im- 
provements at  any  cost  to  win  the  market  is  a  factor  de- 
ciding the  issue.  It  is  not  the  cheapening  of  production 
that  counts,  but  the  difference  in  sales  resulting  from  any 
degree  of  cheapening.  If  the  machine  means  only  a  five 
per  cent,  saving  in  "  socially  necessary  labor,"  to  use 
Marx's  expression,  the  old  machine  will  not  be  scrapped 
on  socialistic  principles.  But  if  between  competitors  a 
five  per  cent,  cost  reduction  means  the  difference  of  hold- 
ing or  losing  a  market  the  new  machine  will  be  installed 
regardless  of  what  society  loses  by  the  substitution. 
Capitalism  not  only  tolerates  but  encourages  fads  and 
fashions,  the  discarding  of  the  old,  and  the  frequent  re- 
newal of  both  production  and  consumption  goods.  It  is 
not  for  most  people  a  question  of  wearing  out  apparel, 
but  of  being  in  style.  The  adventitious  values  of  fashion 
and  elegance  which  human  nature  makes  possible  and 
social  organization  has  assiduously  cultivated  for  ulterior 
motives,  these  values  move  us  to  spend  our  money  when 
we  know  we  shouldn't.  Utility  is  no  longer  primary,  but 
secondary.  We  wear  clothes  not  to  be  warm  and  com- 
fortable, but  to  look  well  or  at  any  rate  look  up  to  date. 
Waste  is  not  illogically  taken  to  be  circumstantial  evi- 
dence of  wealth.  We  may  fool  our  good  friends  and 
really  have  less  than  they  are  led  to  believe,  but  the  im- 
pression we  make  repays  us  for  our  reckless  outlays. 


146  THE  LIMITS  OF  SOCIALISM 

Socialism  may  put  a  curb  to  this  sort  of  display  and 
waste.  Of  course,  it  would  be  hard  to  decide  whether, 
for  one  thing,  it  can  be  done,  and  for  another  thing, 
whether  the  saving  would  mount  up  sufficiently,  but  it  is 
well  to  grant  socialism  a  gain  of  labor-power  on  this 
score. 

§  6.  Possible  Recomposition  of  the  National  Income. 
—  Savings  of  this  kind  however  bring  us  to  the  second 
means  of  a  general  character  for  raising  the  incomes  of 
the  masses.  The  first,  we  noted,  was  an  increase  of  labor, 
natural  resources,  or  of  efficiency  tested  per  individual  or 
socially.  By  these  methods  we  have  found  an  increase  of 
ten  or  fifteen  per  cent,  in  wages  to  be  made  possible.  But 
since  this  is  not  enough  a  change  in  the  composition  of  the 
national  output  of  goods  will  have  to  accompany  a  change 
in  volume.  If  we  can  get  rid  of  all  useless  types  of  labor 
which  do  not  cater  to  the  average  wage  earner,  and  con- 
vert this  energy  into  more  generally  useful  services,  then 
the  gain  will  be  real,  even  though  a  few  rich  people  are 
hard  hit. 

The  extent  of  this  change  in  the  ratio  of  necessities  and 
luxuries  may  be  gauged  in  several  ways.  We  may  con- 
sult first,  the  distribution  of  income,  secondly  the  statistics 
on  manufactures  in  which  many  of  the  luxuries  appear, 
and  thirdly  the  occupation  statistics  in  which  may  be 
found  most  of  the  services  figuring  in  large  incomes. 

Table  Five  will  serve  to  indicate  the  main  facts  of 
distribution  for  1910.  It  will  be  noticed  that  it  is  quite 
unequal,  the  great  majority  having  less  than  $1000  a 
year,  while  a  few  boast  an  income  of  several  millions. 
Forty  per  cent  of  all  the  families  in  the  United  States 
had  less  than  $700  annually,  seven-tenths  had  not  over 
$1000,  and  only  about  ten  per  cent,  had  in  excess  of 
$1500.  Yet  the  national  income  at  that  time  was  about 


THE  LIMITS  IN  PRODUCTION 


147 


$32,000,000,000,  of  which  probably  some  twenty-five 
billion  represented  consumable  goods  for  personal  use. 
The  remainder  consisted  of  capital  goods.  If  then  we 
divide  this  smaller  sum  of  $25,000,000,000  by  a  popula- 

TABLE  FIVE 

The  Distribution  of  Incomes  in  the  United  States 
in  1910 

(Estimates  of  Dr.  W.  I.  King,  in  his  "  Wealth  and  Income  of  the 
People  of  the  United  States,"  pages  224-228.) 

Cumulative  Number  of     Cumulative  Amount 
Family  Income  Income-receiving  Units,          of  Income,  in 

of  not  over  in  Thousands  Millions  of  Dollars 


$700 
$1,000 
$1,200 
$1,500 


$4,000 

$5,200 

$10,000 

$100,000 

$1,000,000 


Family  Income 

of  not  over 

$700 

$1,000 

$1,500 

$2,400 


10,878  5,807 

19,402  12,969 

22,830  16,703 

25,243  19,867 

27,016  33,158 

27,496  24,660 

27,644  25,326 

27,818  26,514 

37,941.6  29,521 

27,945  30,038 

Grand  Total  27,945.2  30,529 

THE  DISTRIBUTION  IN  PERCENTAGES 

Cumulative  Percentage 
Cumulative  Percentage      of  Total  Income 
of  Families  Having         Received  by  Given 
Given  Income  Class  of  Families 

19.02$, 
42.48% 


90.31% 
96.18% 


74.71% 


tion  of  ninety-two  million  we  obtain  a  per  capita  income 
of  approximately  $270.  Multiply  this  by  five,  and  the 
average  family  would  have  an  income  of  $1350.  This 
might,  according  to  socialistic  standards,  be  called  the 


148  THE  LIMITS  OF  SOCIALISM 

normal  income  at  that  date.  The  standard  of  living  is 
not  fixed  rigidly  any  more  by  socialists  than  by  econo- 
mists. It  varies  with  time  and  place,  and  above  all  it 
varies  with  the  productiveness  of  the  nation.  There  is  an 
objective  standard  set  by  the  requirements  of  physical 
and  mental  vigor,  and  a  subjective  one  kept  in  mind  by 
the  individual.  Socialism  may  consider  that  income  nor- 
mal which  at  any  time  embraces  the  largest  class  of  con- 
sumers. In  that  case  $1000  annually  would  be  more 
nearly  the  goal  to  steer  for  than  $1350.  But  it  is  cer- 
tain that  socialists  aim  at  a  marked  improvement  of  the 
general  mode  of  living.  Their  ambitions  are  well  known. 
The  quantitative  aspect  of  this  desire  for  betterment  will 
doubtless  involve  a  thorough  revision  of  family  budgets. 
A  reapportioning  of  goods  and  services  will  take  place, 
so  that  all  families  have  the  luxuries  now  (1910)  enjoyed 
by  those  with  $1500  a  year  or  more. 

Four-fifths  of  the  American  people  in  1910  had  not 
over  $1200  income.  Luxuries  for  them  were  but  a  small 
part  of  their  budget.  It  is  indeed  doubtful  whether  at 
the  purchasing  power  of  money  for  1910  a  family  with 
a  hundred  dollars  a  month  could  have  spent  more  than 
five  per  cent,  on  luxuries.  But  the  other  fifth  of  the 
population  had  so  much  the  more.  The  great  bulk  of  its 
expenses  consisted,  according  to  our  definition  of  a 
standard  of  living  at  that  time,  of  luxuries.  Thus,  i£ 
we  make  due  allowance  for  what  the  rich  spend  in  the 
purchase  of  necessities,  we  have  about  one-fifth  of  the 
national  income  represented  by  luxuries.  It  is  this  fifth 
which  socialism  will  turn  over  to  the  poor.  Or  rather 
it  is  the  labor  and  capital  required  for  producing  these 
luxuries  that  socialism  will  turn  into  other  channels. 
The  output  of  necessities  and  comforts  will  increase,  and 
that  of  extreme  luxuries  will  end. 


THE  LIMITS  IN  PRODUCTION  149 

The  statistics  on  manufactures  throw  further  light  on 
the  matter.  They  do  not,  to  be  sure,  contain  all  of  the 
luxuries  consumed  by  the  wealthy.  A  variety  of  things 
for  the  use  of  which  the  rich  are  noted  is  not  enumerated 
by  the  census  taker.  There  are  magnificent  mansions,  for 
instance,  and  golf  links  and  racing  stables  and  Pekingese 
dogs,  and  rare  viands  and  art  works  and  pleasure  yachts 
and  private  Pullmans,  and  display-fountains  and  liveried 
servants  and  curios  and  opera  seats,  fancy  dress  balls  and 
silver  plate,  and  tiaras  and  mausoleums,  none  of  which 
will  be  found  in  the  official  records.  Yet  they  figure  in 
the  budgets  of  the  plutocrats. 

Again,  it  is  impossible  to  tell  from  the  official  classifica- 
tion whether  an  article  is  really  a  luxury  or  not.  The 
output  of  woolen  mills,  for  instance,  may  be  luxury  or 
necessity  according  to  quality  of  the  fabric.  The  choice 
of  tailor  and  of  trimmings  will  further  guide  us  in  defining 
the  finished  suit.  It  may  either  prove  to  be  a  high-class 
luxury  or  if  the  material  was  made  up  in  the  sweatshop, 
we  may  be  able  to  buy  the  suit  at  such  a  low  figure  that 
we  refuse  to  class  it  among  the  luxuries.  Shape  and 
style,  finish  and  quality  of  ingredient,  time  and  place  of 
purchase,  these  and  other  items  decide  whether  the  com- 
modity is  a  necessity  or  not. 

But  even  if  the  limitations  of  a  statistical  compilation 
are  glaring,  the  appended  Table  Six  will  have  some  use- 
fulness. Whether  we  agree  on  all  the  articles  or  not, 
the  omitted  items  will  probably  somewhere  near  balance 
those  listed  wrongly.  Within  ten  or  fifteen  per  cent,  the 
list  of  manufactured  luxuries  will  agree  with  facts.  With 
this  understanding  it  is  instructive  to  note  that  10 A% 
of  the  aggregate  of  manufactures  consisted  of  luxuries, 
the  production  of  which  required  !!.£%  of  the  total 
labor-force,  entrepreneurs  and  superintendents,  etc.,  in- 


150  THE  LIMITS  OF  SOCIALISM 

eluded.  These  figures  apply  to'  the  year  1914  when  the 
total  national  income  was  about  thirty-five  billion  dollars. 
In  terms  of  that  total,  therefore,  the  luxuries  amounted 
to  7%,  while  the  producing  forces  made  up  about  2.5% 
of  all  gainfully  occupied  in  that  year. 

Most  of  this  material  and  energy  can  no  doubt  be 
turned  to  better  uses.  Socialism  has  a  large  field  to  cul- 
tivate, and  great  are  the  possibilities  for  reform  by  way 
of  a  recomposition  of  our  national  budget. 

It  is  possible,  e.  g.,  to  build  cottages  with  the  product 
of  brickyards  and  quarries  that  now  help  to  build  palaces 
and  accessory  edifices  on  the  estates  of  the  multi-million- 
aire. It  might  even  be  possible  to  furnish  every  family 
a  decent  apartment  to  live  in,  or  a  house  and  lot  such  as 
the  middle  classes  now  point  to  with  pride !  In  1910  there 
were  over  twenty  million  families  in  the  United  States,  of 
which  nearly  eleven  million  rented  their  homes.  It  is  dif- 
ficult to  get  at  the  number  of  houses  occupied  by  one 
family  or  a  single  tenant  because  the  Census  Bureau 
classed  every  sort  of  sleeping  quarters  as  a  dwelling, 
while  conversely  every  dwelling  place  figured  as  one  fam- 
ily.2 Thus  a  single  occupant  of  a  tent  or  way-car  or 
boathouse  was  rated  as  a  family,  but  so  were  all  the 
inmates  of  a  hotel.  They  too  were  counted  as  one  family. 
Owing  to  such  irresponsible  procedure  in  classification 
there  is  no  direct  way  for  finding  out  how  many  families 
had  an  individual  home  of  their  own.  However,  it  is 
significant  that  only  nine  million  out  of  twenty  million 
families  owned  the  place  they  lived  in.  Judging  from 
that  circumstance  we  can  hardly  count  on  more  than  one 
dwelling  house  for  every  two  families  in  the  country.  And 

2  "Thirteenth  Census  of  U.  S.,"  Census  Bureau,  Volume  1,  p. 
1285. 


THE  LIMITS  IN  PRODUCTION 


151 


TABLE  Six 

American  Manufactures  in  1914  Which  Were  Consumed 

Chiefly  by  People  Earning  Over  $1200  a  Year 

(Reference:    U.  S.  Census  Bureau,  Manufactures  in  1914.) 
(Thousands  omitted) 

Number  of  Value  of 
Industry                                                   Persons  Engaged      Product 

in  Industry  $ 

Artificial  flowers    9,300  19,000 

Artists'    materials    1,000  3,000 

Automobile  and  parts  146,000  633,000 

Fancy   boxes    50,600  75,000 

Carpets  not  rag  carpets 33,000  69,000 

Chocolate    5,000  36,000 

Clocks  and  watches   35,000  34,000 

Fancy  articles,  not  elsewhere  specified....          13,300  25,000 

Fireworks    1,500  2,300 

Fur  goods   15,200  46,400 

Leather  gloves  12,300  21,600 

Haircloth  and  hairwork  2,300  5,700 

Jewelry    46,000  119,000 

Millinery  and  lace   54,000  114,000 

Mineral  waters    25,000  58,000 

Motorcycles     7,700  22,000 

Musical  instruments    55,000  120,000 

Fountain  pens   5,200  7,500 

Photographic  apparatus   11,300  39,000 

Rubber  goods,  not  elsewhere  specified 62,000  224,000 

Silk  goods  116,000  254,000 

Silverware     18,400  38,200 

Sporting  goods    6,300  13,000 

Stationery,  n<ot  elsewhere  specified 9,000  32,000 

Stationery  and  art  goods   2,400  4,000 

Toys  and  games   9,000  14,000 

Upholstering  materials 5,000  16,000 

Washing  machines    3,000  7,600 

Carved  woods    13,400  19,000 

Woolen  goods    170,000  395,000 

Total  here  listed  930,000  2,516,000 

Absolute  total   8,265,000  24,200,000 

Percentage  of  listed  workers  and  values..          11.2%  10.4% 


152  THE  LIMITS  OF  SOCIALISM 

of  these  many  live  in  crowded  quarters,  a  few  rooms  to  the 
family  with  small  regard  for  sanitation. 

Considering  all  things  it  seems  therefore  best  not  to  ex- 
pect too  much  at  once  from  a  regrouping  of  concrete 
commodities  entering  into  the  average  family  budget. 
But  there  is  more  chance  for  doing  away  with  useless  types 
of  labor  such  as  now  cater  mainly  to  the  wealthy.  The 
producers  of  intangible  goods,  that  is  of  personal  serv- 
ices, are  alljoo  numerous  from  the  standpoint  of  the  small 
earner.  Much  energy  might  be  liberated  by  shifting  these 
producers  to  new  fields,  by  rearranging  the  ratios  of  dif- 
ferent kinds  of  personal  service  now  rendered.  On  social- 
ist principles  this  change  should  certainly  be  strongly 
urged. 

Table  Seven  gives  the  main  facts  relating  to  this  ques- 
tion. It  will  be  seen  that  in  1910  nearly  two-fifths  of  the 
people  gainfully  occupied  were  not  producing  concrete 
goods,  the  majority  figuring  under  the  professions  or  as 
traders,  domestic  servants.  Out  of  a  total  of  38,000,000 
the  professional  group  —  teachers,  lawyers,  etc.  —  ac- 
counts for  nearly  5%,  the  domestic  and  personal  services 
for  more  than  12%,  and  the  personnel  employed  in  trans- 
portation and  trade  for  another  20%.  These  are  the 
workers  that  did  not  produce  food  or  clothing,  but  con- 
sumed both  in  rendering  a  different  sort  of  value.  Some 
of  them  of  course  were  indispensable  to  the  methods  of 
production  and  to  the  scale  of  production  which  made 
food  and  clothing  so  plentiful.  It  would  be  folly  to  con- 
sider the  employment  of  all  of  them  as  unnecessary  to  the 
production  of  tangible  goods.  Socialism  does  not  assert 
this,  nor  will  any  one  expect  socialism  to  abolish  such 
services  altogether. 

The  chief  task  is  a  reduction  of  this  number,  so  that 
the  army  of  farmers  and  manufacturers  is  increased.  In 


THE  LIMITS  IN  PRODUCTION 


153 


TABLE  SEVEN 

Number  of  Gainfully  Occupied  in  the  United  States  m 
1910,  to  be  Reduced  or  Eliminated  Under  Socialism 

(Reference:     United  States  Census  on  Occupations  for  1910.) 
A.     THE  GAINFULLY  OCCUPIED  IN  SPECIFIED  SERVICES 
(Thousands  omitted) 

Engaged  in  Transportation 2,637 

Trade    3,615 

Public    services    459 

Professional   services.   1,664 
Domestic      and      per- 
sonal services   3,772 

Clerical    occupations.   1,737 


Note:  This  represents 
labor  not  engaged  di- 
rectly in  the  Production 
of  concrete  goods. 


Total     13,884 


B.     ESTIMATED  SAVINGS  IN  CERTAIN  OCCUPATIONS 
(Thousands  omitted) 


In  Transportation 

Carriage  drivers    35 

Chauffeurs     

Garage  keepers   

Hostlers,  etc , 


46 

5 

63 

Livery  stables    35 

Teamsters,   etc 16 

Railroad  employees   1,247 

Express,  telegraph,  etc 314 

Others  322 


Total 
Estimate  saving  at 


2,083 
694 


In  Trade 

Bankers    .................  56 

Brokers  of  all  kinds  ......  49 

Store    clerks,    salespersons, 

etc  ..................  1,368 

Commercial  travelers  .....  164 

Window-dressers,  etc  .....  5 

Deliverymen    .............  230 

Floor  walkers,  etc  ........  21 

Samplers,   etc  ............  13 


Insurance  agents 98 

Porters,  etc 102 

Newsboys     30 

Employment  office  owners, 

elevators,  etc 22 

Real  estate  agents   126 

Retailers    1,195 

Wholesalers    51 

Canvassers,  etc 105 

Book-keepers,   etc 487 

Other  clerks   720 


Total  4,842 

Estimate  saving  at  % 


In  Public  Services 
Marshals,  sheriffs,  etc.  . . . 

Policemen    

Soldiers,  sailors   


24 
64 

77 


Total   163 

Estimate  saving  at  ^ 55 


154  THE  LIMITS  OF  SOCIALISM 

In  Professional  Services 

Lawyers,  etc 115  Janitors  and  sextons 113 

Notaries'    7  Hotelkeepers,  etc 65 

Keepers  of  charitable  insti-  Housekeepers  (lodging, 

tutions,  etc 23             etc.)     189 

Laborers,   unspecified    53 

Total   145  Personal  servants   1,572 

Estimate  saving  at  % 100  Waiters,  etc 188 

Total  2,631 

In  Personal  and  Domestic  Estimate  saving  at  % 2,000 

Services  Total  saving  6,075 

Barbers,  etc 195          All  gainfully  occupied  in 

Bartenders  and  barkeepers     231  1910  38,200 

Elevator  boys,  etc 25      Per  cent,  of  saving 15.9% 

1910  about  three-fifths  of  the  population  furnished  all 
the  commodities.  Whatever  the  entire  population  needed, 
that  was  produced  by  6%%  of  it.  No  more  eloquent  testi- 
mony to  the  wealth  of  the  United  States  and  to  the 
efficiency  of  its  people  could  be  given.  It  is  the  result 
of  the  same  conditions  that  made  it  possible  for  twelve 
million  farmers  and  farm-laborers  to  feed  the  remaining 
eighty-five  million,  besides  having  something  left  for  ex- 
portation. A  rich  country  will  naturally  add  many  per- 
sonal services  to  its  fund  of  concrete  consumables.  The 
trend  toward  non-necessities  is  thus  illustrated,  and  no 
one  would  wish  a  return  to  the  costlier  system  of  the 
"  simple  life." 

Yet  it  is  plain  that  a  notable  portion  of  this  intangible 
wealth  benefits  only  a  very  few,  and  that  much  of  it  is 
either  quite  useless,  or  outright  injurious  and  demoraliz- 
ing for  the  general  run  of  people.  It  is  not  well  that  so 
much  energy  is  wasted  in  the  rendering  of  trivial  serv- 
ices. Hundreds  of  thousands  of  domestic  servants  are  not 
needed,  especially  among  those  who  employ  them  in  large 
numbers.  Neither  will  socialism  have  much  use  for  the 
millions  that  now  are  engaged  in  commerce  or  in  some  of 


THE  LIMITS  IN  PRODUCTION  155 

the  professions.  We  find  in  the  list,  for  instance,  com- 
mercial travelers  and  book  agents,  floor  walkers  and 
private  secretaries,  clerks  and  typists,  teamsters  and 
messenger  boys,  advertising  agents  and  curb  brokers, 
printers  and  journalists,  janitors  and  watchmen,  body 
guards  and  doorkeepers,  manicures  and  maids-in-waiting, 
charity  workers  and  chauffeurs  for  private  families.  A 
certain  percentage  of  these  will  and  should  be  retained, 
but  many  of  them  socialism  will  place  in  other  positions. 
If,  as  suggested  in  the  Table,  we  select  certain  occupa- 
tions and  then  decide  upon  a  curtailment  according  to 
the  nature  of  the  services  now  rendered,  we  shall  find  that 
somewhere  about  one-half  of  the  total  number  of  gainfully 
occupied  not  producing  concrete  goods  may  be  cut  off. 
About  16%  of  all  gainfully  occupied  in  1910  would  thus 
go  into  new  lines  of  work. 

It  should  be  noted  in  passing  that  our  three  tests  of 
luxury  consumption  and  therefore  of  the  possibility  for 
a  rise  of  the  average  man's  income  correspond  roughly. 
In  each  case  we  find  a  difference  of  about  one-fifth.  The 
redistribution  of  this  fifth  marks  the  extent  to  which 
socialism  is  tolerably  sure  of  helping  the  masses  who  in 
1910  earned  less  than  $1000  or  $1200  per  year. 

§  7.  Other  Limits  in  Production. —  Whether  all  of  the 
poor  would  hail  the  readjustment  with  delight,  however, 
is  a  question,  for  the  change  will  involve  some  losses  as 
well  as  a  great  gain.  It  is  ever  so.  The  well-to-do,  of 
course,  will  suffer  most,  since  the  recomposition  of  the 
national  budget  also  means  a  redistribution  of  incomes. 
To  them  the  elimination  of  luxuries  in  goods  and  services 
will  bring  the  greatest  sacrifices.  But  it  will  also  have  a 
drawback  for  the  masses  of  the  people  who  have  long  been 
used  to  the  glamor  of  city  life  as  competitive  principles 
engendered  it.  There  are  some  features  about  the  present 


156  THE  LIMITS  OF  SOCIALISM 

method  of  retailing  goods  that  those  who  bother  not 
about  maximum  welfare  will  prefer  to  the  socialistic 
scheme.  And  one  cannot  altogether  blame  them. 

The  possession  of  concrete  goods  is  not  everything  even 
to  those  of  limited  means.  There  is  some  satisfaction  in 
seeing  what  one  cannot  own,  and  there  are  many  who  pre- 
fer the  courtesies  of  a  competitive  business  to  the  preci- 
sion of  a  public  service  controlled  by  the  state.  Thus 
some  will  feel  that  little  is  gained  by  having  an  extra 
pair  of  shoes  or  twice  the  allowance  in  furniture,  if  the 
goods  must  be  bought  from  a  government-owned  ware- 
house where  the  clerk  cares  nothing  about  the  customer, 
but  on  the  contrary  is  conscious  of  rights  which  place  him 
at  an  advantage.  Shopping  is  now  made  a  pleasure  by 
those  who  wish  to  attract  patrons  and  expand  business 
regardless  of  social  welfare,  or  perhaps  in  full  harmony 
with  it.  The  down-town  districts  of  a  large  city  are 
a  commentary  on  the  spirit  of  modern  enterprises. 
Everything  is  subordinated  to  the  maxim  for  profits. 
The  customer  is  always  right  —  as  long  as  he  pays  the 
price.  Many  people  enjoy  this  situation  and  would 
rather  have  the  window  displays  of  a  fashionable  depart- 
ment store  than  cheaper  ribbon  or  better  housing  condi- 
tions.-. And  so  with  the  services  of  newsboy  and  shoeblack 
and  hotel-porter  and  all  the  rest  of  servitors  catering  to 
the  rich  chiefly,  but  to  the  poor  also  in  some  measure. 

And  lastly,  it  is  likely  that  the  law  of  diminishing  re- 
turns will  set  limits  to  the  output  of  comforts  regardless 
of  what  socialism  decrees  or  the  people  may  desire.  The 
staples  of  life  are  most  subject  to  decrease  in  accordance 
with  the  principle  first  enunciated  by  the  Ricardians. 
We  cannot  add  to  our  agricultural  stores  at  random  as 
we  may  increase  the  output  of  minerals.  These  latter 
returns  need  not  fall  off  for  long  times  to  come,  but  in  so 


THE  LIMITS  IN  PRODUCTION  157 

far  as  farm-products  furnish  the  basis  for  manufacturing, 
or  supply  the  population  with  foods,  the  national  labor- 
power  is  always  at  its  mercy.  Thus  in  European  coun- 
tries the  peak  of  productivity  has  long  been  reached.  In 
the  United  States,  whatever  increases  in  acre-yield  may 
come,  will  be  expensive.  The  farmer  is  sure  to  sell  at  a 
rising  price.  The  gain  will  be  smaller  than  the  cost  in 
labor  and  capital.  The  yield  per  acre  may  rise,  but  ex- 
penses will  rise  even  more.  dThe  more  luxuries  of  one  kind 
the  socialist  demands,  the  more  of  another  kind  he  will 
have  to  forego,  or  else  do  without  a  corresponding  amount 
of  necessaries.^ 

The  nineteenth  century  established  many  records  that 
will  not  be  repeated  for  a  long  while.  Thanks  to  them 
the  white  race  has  multiplied  its  income  in  goods,  learn- 
ing to  cherish  precisely  such  ideals  of  future  development 
as  socialism  stands  for.  But  it  is  not  likely  that  the  next 
few  hundred  years  will  witness  a  similar  growth  in  till- 
able acreage,  in  timber  supply,  and  in  the  output  of 
minerals.  Science  and  organization  have  done  their  ut- 
most. They  have  made  the  nineteenth  century  the 
wonder  of  all  ages.  Yet  the  level  of  living  has  for  the 
masses  not  risen  as  much  as  socialists  expect  to  raise  it 
hereafter,  nor  has  the  flow  of  luxuries  sufficed  to  satisfy 
the  masses.  In  Europe  foreign  trade  proved  a  valuable 
means  for  the  diversification  of  living.  The  output  of 
factory  and  mine  was  exchanged  for  raw  materials  bought 
abroad,  and  the  teeming  millions  were  fed  with  stocks 
grown  in  the  Americas  or  in  the  plains  of  Siberia  and 
Australia.  Even  the  East  Indies  and  the  dark  continent 
furnished  a  quota. 

This,  then,  is  the  secret  of  a  high  level  of  living  among 
the  minority  of  Europeans.  By  exporting  large  values 
in  tiny  packages  they  managed  to  obtain  the  basic  ma- 


158  THE  LIMITS  OF  SOCIALISM 

terials  or  rare  luxuries.  In  the  future,  however,  this  will 
not  be  so  easy.  The  more  densely  populated  the  erstwhile 
frontier  lands,  that  were  the  granaries  of  Europe,  the  less 
certain  their  exports  of  foods,  and  more  self  sufficient  the 
European  nations  must  become.  The  regulation  of  the 
birthrate  is  one  means  of  frustrating  the  designs  of  a 
sinister  law  of  nature,  but  this  is  not  a  peculiarly  social- 
istic means.  Nor  do  wars  solve  the  problem.  The  war 
just  closed  e.  g.,  has  slain  many  millions,  but  it  has  also 
exterminated  the  ablest  instead  of  the  worst,  and  that  re- 
acts disadvantageously  upon  both  agriculture  and  in- 
dustry. The  only  alternative  to  a  reduced  food  allow- 
ance, consequently,  is  an  increased  acre  yield  at  the  cost 
of  comforts  and  luxuries.  In  the  long  run  nobody  can 
escape  this  situation. 

People  in  the  United  States  do  not  entertain  such  fears 
of  a  reduction  in  food.  Yet  there  are  indications  that  for 
them,  too,  future  gains  will  mean  a  more  than  propor- 
tionate expense  of  human  and  mechanical  energy.  True, 
if  the  United  Kingdom  can  produce  thirty-five  bushels 
of  wheat  per  acre,  so  can  we.  But  this  is  nothing  to  gloat 
over.  On  the  contrary  we  should  regret  the  step. 
Furthermore,  it  will  particularly  interfere  with  socialistic 
plans,  since  the  workers  set  free  by  the  elimination  of  use- 
less services  will  increasingly  be  drawn  to  the  farm  in- 
stead of  producing  manufactures. 

Within  a  few  generations  such  a  turn  for  the  worse  is 
certain  unless,  as  remarked  before,  birth-control  is  popu- 
larized as  one  may  expect  it  will  be.  But  in  any  case  it 
deserves  notice  that  in  the  distant  future  the  over-popu- 
lated countries  will  not  be  able  to  fall  back  upon  machino- 
factures  for  a  supply  of  necessities.  The  world  is  becom- 
ing rapidly  settled.  Frontier  regions  still  exist,  but  may 
not  have  foodstuffs  to  export  in  such  amounts  as  the 


THE  LIMITS  IN  PRODUCTION  159 

nineteenth  century  Europe  needed.  When  that  date  ar- 
rives socialism  will  have  only  one  refuge  for  the  poorly 
endowed  countries.  Namely,  it  will  have  to  fund  the 
world's  supplies  so  as  to  maintain  a  high  level  of  living 
among  the  least  favored  nations.  The  increase  of  luxuries 
may  then  continue,  but  it  will  not  reach  the  proportions 
some  hope  for,  and  the  funding  process  which  is  after  all 
the  logical  goal  of  economic  socialism  will  encroach 
further  upon  the  luxury  rations  of  the  inhabitants  in  the 
richest  lands.  Thus  will  production  have  found  its  limits. 


CHAPTER  VH 
THE  LIMITS  IN  DISTRIBUTION 

§  i.  The  Spending  Power  of  the  Rich —  Production 
determines  distribution.  A  nation  cannot  distribute 
more  among  its  members  than  it  has  at  its  disposal  per 
annum  in  goods  and  services.  To  the  extent,  therefore, 
that  socialism  fails  in  augmenting  the  social  dividend  it 
must  also  fail  in  raising  the  level  of  living  of  the  average 
man.  This  is  on  the  understanding  that  the  total  na- 
tional income  is  divided  evenly  between  all  the  citizens. 
But  of  course,  this  equality  never  existed  and  is  not  con- 
templated by  socialism. 

There  is  consequently  much  room  for  a  change  of  in- 
dividual or  family  incomes  without  altering  materially  the 
productiveness  of  the  nation.  In  1910  two-fifths  of  the 
earning  population  received  less  than  one-fifth  of  the  na- 
tional income,  and  one-fifth  of  the  people  claimed  over 
one-half  of  the  aggregate.  To-day  the  distribution  can- 
not be  greatly  different,  though  as  a  result  of  the  war 
just  brought  to  a  conclusion  some  groups  of  labor  have 
raised  their  purchasing  power  slightly,  while  some  of  the 
formerly  well-to-do  have  lost  heavily.  Wars  always 
mean  a  redistribution  of  incomes. 

But  the  general  fact  is  the  same  for  all  nations.  We 
shall  perhaps  always  have  the  poor  with  us  if  no  radical 
change  in  economic  organization  takes  place.  The  poor 
always  have  been  in  the  majority  so  far,  and  because  of 
this  disparity  existing  everywhere  the  task  of  socialism 
is  clearly  defined.  It  may  try,  and  it  solemnly  promises, 
to  redistribute  goods  so  that  all  have  the  necessities,  and 

160 


THE  LIMITS  IN  DISTRIBUTION          161 

none  sj)end  greatly  in  excess  of  what  the  average  man  is 
allowed. 

It  should,  however,  be  understood  that  the  present  un- 
equal distribution  is  no  worse  than  it  has  been  in  the  past, 
that  the  largest  incomes  do  not  measure  spending  power, 
and  that  without  state  aid  a  slow  diffusion  of  national 
wealth  among  all  the  inhabitants  does  take  place.  Social- 
istic literature  has  been  somewhat  misleading  on  these 
points. 

The  poor  are  to-day  no  worse  off  than  they  were  in 
olden  times.  On  the  contrary,  there  is  plenty  of  evidence; 
to  show  that  unmitigated  pauperism  is  on  the  wane,  j 
Among  the  ancients  wealth  was  unevenly  distributed  be- 
cause land  was  the  chief  natural  resource,  and  this  be- 
longed to  a  few.  When  the  level  of  living  comprised  not 
much  more  than  food  and  clothing  even  for  the  rich,  then 
the  chief  privilege  of  the  wealthy  was  leisure  and  power 
over  the  body.  Slavery  with  all  its  attendant  rights  of 
the  owner  furnished  a  sense  of  power  such  as  nowadays  un- 
doubtedly comes  with  the  control  of  large  industrial 
plants  or  public  undertakings.  All  through  the  Middle 
Ages  this  division  of  privileges  and  duties  was  continued. 
The  Church  did  not  discourage  it,  though  it  preached  now 
and  then  of  the  brotherhood  of  man.  The  line  of  divi- 
sion between  lord  and  vassal,  between  freeman  and  serf, 
between  noble  and  burgher  was  distinctly  drawn  and  ob- 
served in  social  intercourse.  The  minority  of  nobles  and 
clergy  owned  the  land  or  held  it  in  fee  simple  from  the 
Crown  or  Holy  See  respectively,  while  the  bulk  of  the 
population  owned  no  more  than  the  food  they  ate  and  the 
clothes  on  their  back.  It  was  not  till  the  end  of  the  four- 
teenth century  that  private  ownership  among  the  unnoble 
became  important.  Fortunes  then  were  amassed  with 
which  eventually  the  middle  class  made  itself  master  of 


162  THE  LIMITS  OF  SOCIALISM 

political  affairs.  But  the  concentration  of  wealth  was 
continued  as  before,  except  that  new  forms  of  wealth  ap- 
peared, and  that  hereditary  rights  to  office  were  over- 
shadowed by  inheritance  of  wealth.  When  this  change 
came  capitalism  had  won  the  day  for  the  plebeian  ma- 
jority, even  though  income  itself  still  fell  into  the  hands  of 
a  small  group  of  enterprisers. 

Until  quite  recent  times  wealth  was  less  powerful  and 
conspicuous  also  in  the  sense  that  it  could  not  buy  what 
the  rich  now  display  so  lavishly.  The  basis  of  national 
subsistence  was  agriculture.  Manufactures  made  up  the 
smallest  part  of  the  social  dividend,  so  that  income  was 
spent  mainly  in  the  building  of  castles,  and  in  viands  and 
costly  raiments.  The  materials  were  expensive  enough, 
but  the  total  effect  of  such  extravagances  was  not  as 
obvious  as  it  is  to-day.  Palaces  were  for  protection 
rather  than  for  comfort,  or  if  meant  for  comfort  the 
limitations,  at  any  rate,  of  the  value  of  money  were  much 
more  apparent  than  to-day.  Science  had  not  yet  made 
the  discoveries  that  furnished  the  immense  variety  of  com- 
forts now  so  highly  prized.  The  rich  had  more  candles 
to  burn,  but  the  light  was  about  the  same.  They  had 
wood  in  the  winter,  but  so  had  most  of  the  tenants  on 
the  estate.  Rich  food  and  gorgeous  though  ill  fitting  ap- 
parel, security  against  the  enemy  in  early  ages  such  as 
the  poor  could  not  get,  an  abundance  of  silver  and  gold 
plate,  and  perhaps  precious  jewels  from  the  Orient  — 
such  were  the  means  by  which  the  millionaires  formerly 
made  themselves  envied.  The  forms  of  display  were  not 
as  ostentatious  as  to-day,  and  the  people  were  not  as  close 
to  them.  The  chase  and  the  feud  were  pastimes  the  multi- 
tude did  not  care  for  anyway.  A  difference  in  learning 
either  did  not  exist  or  did  not  challenge  attention  be- 
cause of  the  limits  of  science.  And  besides,  the  multitude 


THE  LIMITS  IN  DISTRIBUTION          163 

until  a  few  generations  ago  did  not  aspire  to  a  status 
such  as  now  is  deemed  the  proof  of  well-being  and  democ- 
racy. 

Again,  however,  it  would  be  a  mistake  to  assume  that 
the  excessively  wealthy  can  spend  all  they  have.  The 
notion  that  a  million  dollar  income  is  actually  spent  for 
comforts  and  luxuries,  or  might  be  so  spent,  is  erroneous. 
It  has  already  been  shown  in  a  previous  chapter  that  the 
statistical  data  disprove  such  a  contention.  They  show 
plainly  that  not  over  one-fifth  of  our  national  product 
consists  of  the  non-necessities,  and  that  more  than  one- 
half  of  this  takes  the  shape  of  goods  consumed  almost  en- 
tirely by  incomes  ranging  between  $1000  and  $2500  for 
1910,  in  the  United  States.  Attention  has  been  called 
also  to  the  fact  that  a  large  portion  of  every  nation's  in- 
come represents  capital  goods  used  for  producing  con- 
crete or  inconcrete  consumption  goods.  Hence  this  part 
of  the  total  is  not  available  for  consumption.  But  it  is 
owned  mainly  by  the  rich.  The  small  earners  save  rarely 
more  than  one-fifth  or  tenth  of  their  income.  They  can- 
not or  will  not  do  so.  But  the  corporation  making  a 
25%  net  profit,  the  man  with  a  hundred  thousand  dollar 
income,  these  are  the  centers  of  financial  power.  From 
them  the  replacement  and  investment  fund  flows.  They 
maintain  the  status  quo  of  industry  or  expand  business 
so  as  to  raise  the  next  year's  social  dividend.  Out  of  the 
millionaire's  income  thus  all  but  a  minor  fraction  remains 
normally  in  productive  condition.  \  If  all  incomes  over 
five  thousand  a  year  were  to  be  spent  in  the  purchase  of 
luxuries,  as  has  occasionally  been  suggested,  our  economic 
system  would  collapse./  There  would  be  no  labor  and 
capital  to  provide  the  necessities ;  nor  could  the  plan  for 
the  rich  men  work  out  well.  Such  spending  would  prove 
to  be  impossible. 


164*  THE  LIMITS  OF  SOCIALISM 

Large  incomes  then  do  not  mean  the  scale  of  living 
that  many  associate  with  them.  Nor  should  it  be  forgot- 
ten that  nearly  all  wealth  eventually  redounds  to  the  ad- 
vantage of  the  masses.  There  is  no  discovery  made  by 
science,  no  invention  patented  by  the  manufacturer,  no 
improvement  introduced  in  the  realm  of  exchange,  but  it 
sooner  or  later  benefits  the  average  man.  It  is  not  pos- 
sible to  secrete  ideas  forever,  vjj,  is  impossible  to  with- 
hold permanently  from  the  people  the  advantages  first  en- 
joyed by  the  wealthy^;;  Most  luxuries  some  day  become 
necessities.  Novelties  in  the  course  of  time  become  an- 
tiquities and  curiosities  of  science,  commonplaces.  A 
watch  to-day  is  bought  for  a  few  dollars,  though  the  work 
of  many  great  men  was  necessary  to  produce  it.  A  Gali- 
leo had  to  formulate  laws  of  motion  before  we  could  meas- 
ure time  accurately.  The  dial  contains  figures  that  some- 
body many  thousands  of  years  ago  invented.  The  pro- 
cesses for  refining  the  ore  used  in  the  case  cover  many 
achievements  scientific  and  mechanic.  The  purchaser  of 
the  watch  does  not  pay  for  all  he  buys  at  the  time.  He, 
on  the  contrary,  expects  to  get  the  benefit  of  ideas  and 
efforts  made  by  others,  a  few  of  them  living,  but  most  of 
them  long  dead.  Social  heredity  is  the  main  source  of 
unearned  increments.  We  profit  by  accepting  the  knowl- 
edge of  our  forebears.  We  all,  in  the  long  run,  get  the 
benefit  of  individual  endeavor  if  it  is  extraordinary  and  of 
lasting  value.  The  rich  cannot  corner  the  market  of 
luxuries  except  for  a  short  while. 

Their  own  fortunes  indeed  crumble.  From  shirtsleeve 
to  shirtsleeve  is  but  three  generations,  according  to  an 
old  adage.  That  does  not  seem  to  be  true,  and  it  cer- 
tainly need  not  apply  to  the  circulation  of  wealth.  But  it 
is  true  that  many  huge  fortunes  are  dissipated  soon  after 
the  founder  has  gone.  In  a  hundred  ways  the  hoard  melts 


THE  LIMITS  IN  DISTRIBUTION          165 

to  nothing.     Periodically  some  rich  men  become  paupers, 
and  some  of  the  poor  accumulate  wealth. 

Yet  in  general  there  is  a  permanent  concentration  of 
income.  The  disparity  is  lasting.  The  well-to-do  con- 
tinue to  be  so,  and  the  wage  earner  of  a  thousand  dollars 
or  two  per  year  continues  to  stay  at  that  figure.  From 
father  to  son  we  have  wealth  and  poverty  transmitted. 
This  is  the  fact  that  socialism  is  conscious  of  and  wishes 
to  change.  It  wishes  to  hasten  the  natural  diffusion  of 
incomes  which  the  laws  of  consumption  bring  about.  It 
insists  upon  helping  the  laws  of  sociation  here  as  at  other 
points  in  the  field  of  economic  relations. 

§  2.  Causes  and  Consequences  of  Concentration  of 
Incomes. —  Socialism  has  answered  the  question,  why  such 
gross  inequalities  of  income  exist,  in  the  spirit  of  certain 
British  writers  whom  Marx  respected  highly.  The  ques- 
tion of  one  and  the  reply  of  another  will  help  to  make 
clear  the  socialistic  attitude,  which  from  the  days  of  Marx 
on  has  remained  the  same  in  this  matter. 
|  W.  Thompson  wrote  in  1824 :  "  How  comes  it  that  a 
nation  abounding  more  than  any  other  [he  refers  to  Eng- 
land, of  course]  in  the  crude  materials  of  wealth  in  ma- 
chinery, dwellings  and  food,  in  intelligent  and  industrious 
producers,  with  all  the  apparent  means  of  happiness,  with 
all  the  outward  semblance  of  happiness  exhibited  by  a 
small  and  rich  portion  of  the  community,  should  pine  still 
in  privation?  How  comes  it  that  the  fruits  of  the  labor 
of  the  industrious,  after  years  of  incessant  and  successful 
exertion,  are  mysteriously  and  without  any  imputation 
of  fault  tojthem,  without  any  convulsion  of  nature  swept 
away?"1  \ 

Conditions  to-day  are  not  as  gloomy  as  those  depicted 

i  Thompson,  W.,  "Inquiry  into  the  Principles  of  Distribution," 
Introduction. 


166  THE  LIMITS  OF  SOCIALISM 

by  this  critic  of  the  individualistic  system,  but  with  some 
modification  the  challenge  might  be  repeated  to-day.  And 
the  answer  would  still  have  to  be  what  a  contemporary  of 
Thompson,  namely  Hodgskin,  thought  it  was.  He  de- 
clared that  "  the  distress  our  people  suffer  —  and  the  pov- 
erty we  all  complain  of,  is  not  caused  by  nature,  but  by 
some  social  institutions  which  either  will  not  allow  the 
laborer  to  exert  his  productive  power,  or  which  rob  him 
of  its  fruits."  2 

Hodgskin  demurred  to  the  charge  of  the  Ricardians  that 
nature  was  at  fault,  that  the  law  of  diminishing  returns 
explained  everything,  or  that  sexual  passion  gave  civ- 
ilization no  chance.  The  socialists  from  Marx  on  have 
supported  this  criticism  of  the  English  radicals  and 
pointed  with  an  accusing  finger  to  capitalism.  The  more 
modern  view  will  not  accept  the  whole  of  the  socialistic 
indictment,  but  it  is  indisputably  true  that  a  change 
should  and  can  be  made. 

The  unequal  distribution  so  far  has  been  the  result  of 
innate  differences  between  men,  and  of  other  differences 
less  constant,  more  controllable.  The  superiorities  of 
some  will  necessarily  bring  them  victory  in  any  battle. 
Physical  strength  and  valor  win  in  a  hand-to-hand  en- 
counter. Great  mental  powers  bring  riches  to  men.  But 
in  addition  we  have  had  legal  monopolies,  the  might  of 
socio-economic  organization  gathered  into  a  few  hands, 
the  ownership,  by  a  small  group,  of  natural  resources 
which  furnish  the  staples  of  consumption,  and  the  right 
of  inheritance,  by  which  the  wealthy  could  perpetuate 
their  holdings  not  only  in  consumables  but  also  in  the 
rawstuffs.  When  the  non-productive  materials  such  as 
mineral  and  timber  and  soil  fertility  and  water-power  are 
deeded  away  to  a  few,  whether  by  purchase  or  free  gift 
2  Hodgskin,  Th.,  "Popular  Political  Economy,"  1827;  pp.  267-68. 


THE  LIMITS  IN  DISTRIBUTION          167 

does  not  matter,  then  unusual  chances  for  gain  are 
opened.  Organization  is  the  fruit  of  brain  and  property 
rights.  It  is  virtually  invincible,  barring  state  action. 
We  can  defeat  brain  by  itself,  and  there  is  always  a 
method  for  controlling  mere  wealth.  But  let  the  two  com- 
bine, and  the  partnership  becomes  nigh  invincible. 

The  socialist  has  his  eye  on  this  combination,  and  de- 
sires to  separate  brain  from  monopoly  in  the  extremely 
scarce  resources  of  the  world.  He  favors  a  redistribu- 
tion of  incomes  to  help  the  less  gifted  by  nature,  and  in 
this  he  has  the  approval  of  science  no  less  than  of  moral 
sentiments. 

A  theory  of  prosperity  such  as  social  science  to-day 
recommends  is  incompatible  with  extremes  in  distribution. 
As  long  as  income  is  a  condition  to  leisure  and  education, 
as  long  as  an  economic  leveling  is  a  prerequisite  to  a  feel- 
ing of  fellowship  in  matters  civic,  moral,  religious  and  in- 
tellectual, so  long  the  juxtaposition  of  plutocrat  and  pro- 
letariat is  full  of  menace.  We  can  develop  dormant  pow- 
ers of  reasoning  and  of  production  or  of  enjoyment  in 
man.  This  modern  psychology  and  biology  prove.  We 
can  produce  more  than  we  need  to  sustain  the  body.  This 
history  has  shown.  We  can  produce  most  by  joint  enter- 
prise and  capitalistic  methods,  meaning  thereby  round- 
about methods  and  the  use  of  machinery,  no  matter  who 
owns  it.  Since  then,  according  to  the  verdict  of  natural 
science  health  depends  on  food  supplies  and  protection 
against  bacterial  diseases,  and  since  an  economic  surplus 
is  necessary  to  the  specialization  which  makes  modern 
science  and  discovery  possible,  it  follows  that  wealth  well 
distributed  is  most  conducive  to  progress.  The  same 
economic  interpretation  of  history  which  socialism  first 
formulated  as  a  sweeping  law  of  evolution  provides  also 
part  of  our  argument  for  urging  equalization  of  fortunes. 


168  THE  LIMITS  OF  SOCIALISM 

Approximate  leveling  must  be  part  of  our  plan  for  de- 
mocratization of  all  rights  and  efforts. 

However,  we  may  look  at  the  situation  from  another 
angle.  We  may  emphasize  the  undoubted  fact  that  distri- 
bution reacts  upon  production  in  two  ways,  viz.,  by  af- 
fecting our  choice  of  goods,  and  by  influencing  the  volume 
of  goods  turned  out,  and  that  for  these  two  reasons  a 
marked  concentration  of  income  is  reprehensible.  This 
viewpoint  has  commonly  been  taken  by  socialists,  and  it 
agrees  with  the  analysis  of  price  advanced  by  profes- 
sional economists.  People  disagree  chiefly  as  to  the  place 
of  competition  in  national  productiveness.^ 

That  an  extreme  concentration  of  wealth  must  influence 
the  enterpriser  in  his  choice  of  goods  to  be  produced 
should  be  self-evident.  But  if  not,  it  follows  logically 
from  the  very  facts  of  utility  and  pricing  which  most 
economists  content  themselves  to  describe. 

The  rich  will  encourage  the  production  of  luxuries  when 
millions  lack  the  necessities.  They  will  do  this  because 
of  the  principle  of  unlimited  wants  and  of  diminishing 
utility.  They  will  do  this  because,  in  equalizing  our 
margins  of  enjoyment  of  goods,  we  are  able  to  offer  differ- 
ent amounts  of  money  for  goods,  once  income  is  unevenly 
divided  among  the  consumers.  The  prices  are  then  for 
all  the  same,  but  the  sacrifices  are  not.  This  is  the  cir- 
cumstance that  socialism  most  deplores. 

Our  wants  are  illimitable.  Thanks  to  our  imagination 
and  power  of  inference  we  are  able  to  wish  for  much 
more  than  we  possess.  We  are  never  satisfied ;  which  is  on 
the  whole  a  good  thing.  But  since  there  seems  always 
room  for  things  besides  those  we  already  own  and  enjoy, 
we  make  unequal  efforts  or  sacrifices  to  obtain  additional 
goods  when  our  possessions  are  unequal. 

And  we  shall  ask  for  different  things,  not  merely  for 


THE  LIMITS  IN  DISTRIBUTION          169 

larger  amounts  of  any  one  article.  \  We  tire  of  one  ar- 
ticle as  we  increase  our  supply  of  it.  We  cease  to  value 
an  over  abundance  of  good  things.  Too  much  dinner 
sates  our  appetites.  One  or  two  musical  instruments  sat- 
isfy our  longing  for  music.  After  we  have  bought  so  much 
of  clothing  or  books  or  furniture  we  want  no  more  of  it, 
or  we  want  very  different  types  of  each,  so  that  we  have 
virtually  something  different. 

We  therefore  always  spend  our  money  deliberately  in ; 
that  we  weigh  the  desirability  of  one  commodity  relative 
to  another.  We  have  options  to  buy  things,  but  cannot 
ordinarily  buy  everything.  We  must  decide  what  we 
want,  how  much  of  each  class  of  goods,  and  in  what  order. 
If,  for  instance,  a  community  has  a  supply  of  water  it  will 
allot  it  for  different  uses  according  to  the  total  supply 
on  hand.  We  may  be  sure  that  our  thirst  will  first  be 
quenched  from  the  supply.  We  shall  put  drinking  water 
before  everything  else.  Then,  if  something  is  left,  we 
shall  perhaps  use  it  for  washing  purposes  and  for  the 
laundry.  If  still  more  remains  we  may  decide  to  sprinkle 
the  streets  with  it,  so  as  to  lay  the  dust.  Or  possibly 
our  garden  back  of  the  house  needs  it,  so  we  shall  use  it 
there.  And  only  if  all  these  needs  are  looked  after  shall 
we  think  of  swimming  pools,  of  public  fountains  and  like 
details. 

In  some  such  order  all  our  articles  of  consumption  are 
used.  An  astonishing  uniformity  of  tastes  will  manifest 
itself  in  the  arrangement  of  broad  classes  of  goods,  how- 
ever infinite  the  variations  in  detail.  We  all  know  what 
are  the  essentials  of  life  on  a  physical  plane.  We  all  at 
first  prefer  clothing  and  shelter  to  bric-a-brac  or  sightsee- 
ing tours  abroad.  We  cannot  indulge  in  trivial  comforts 
antil  a  minimum  for  bodily  sustenance  is  provided.  Then, 
beyond  that  point,  and  in  the  finer  grading  of  preferences. 


170  THE  LIMITS  OF  SOCIALISM 

the  individuality  of  the  purchaser  appears.  The  farmer 
does  not  value  things  like  the  urbanite.  A  clergyman  has 
a  scale  of  choices  different  from  that  of  a  hard  manual 
worker  or  a  scientist  perchance.  Our  temperaments  de- 
termine our  choices.  Some  would  have  more  food  and 
others  more  books.  Some  will  like  to  spend  a  great  deal 
for  pastimes,  while  others  are  eager  to  own  a  home  first 
or  to  acquire  a  college  education.  Tastes  differ  in  the 
particulars. 

But  let  it  be  noted  that  the  unequal  division  of  wealth 
greatly  accentuates  the  natural  differences  in  taste.  For 
now  one  man  has  much  more  to  compare  with  his  pros- 
pective purchase  than  the  other.  The  rich  man  has  a 
long  line  of  wants  already  satisfied,  consequently  thinks 
little  of  his  potential  possessions,  that  is  of  his  money. 
He  will  be  willing  to  give  much  for  trifles  which  the  poor 
man  dare  not  think  of  buying,  since  more  important  needs 
would  then  remain  unfilled.  The  wealthy  person  thus  is 
apt  to  demand  goods  which  no  one  else  wants,  and  which 
are  not  really  a  part  of  a  sound  standard  of  living.  He 
will  divert  labor  and  material  from  employment  that  would 
raise  the  level  of  living  of  small  earners  to  others  which 
cannot  raise  it. 

The  overly  rich  are  systematically  catered  to  by  all 
kinds  of  people  anxious  to  earn  a  fat  living  irrespective  of 
social  welfare.  As  the  saying  is:  Money  talks  and  will 
command  anything  —  and,  one  might  add,  will  command 
to  be  obeyed.  The  rich  man  pays  no  more  for  the  ne- 
cessities than  the  poor  because,  being  a  rare  exception,  he 
cannot  greatly  influence  popular  demand,  that  is  the  ma- 
jority of  valuations  and  of  costs  in  terms  of  sacrifice.  He 
will  pay  ten  cents  for  a  pound  of  sugar,  though  he  could 
give  a  hundred  times  that  sum.  Physicians,  to  be  sure, 
have  introduced  a  scale  of  fees  proportionate  to  earnings 


THE  LIMITS  IN  DISTRIBUTION          171 

real  or  alleged.  This  is  at  times  held  to  be  an  act  of  jus- 
tice. And  it  is,  if  we  single  out  the  services  of  the  phy- 
sician from  all  others  as  being  more  vital,  and  hence  the 
most  valuable  to  the  poor  who  on  a  competitive  basis  might 
have  to  do  without  them.  The  scale  of  prices  is  there- 
fore logical.  But  plainly,  if  all  producers  and  sellers 
were  to  scale  their  prices  according  to  the  purchasing 
power  of  the  customer,  the  end  result  would  be  simply  the 
maintenance  of  present  distribution.  The  adjusting  of 
prices,  including  wages,  to  ability  to  pay  would  prevent  a 
•further  concentration  of  wealth,  particularly  if  it  were 
made  exactly  and  consistently  for  all  services.  But  it 
could  not  abolish  the  present  inequalities  which  socialism 
condemns. 

The  effect  of  a  marked  concentration  of  wealth  on  pro- 
ductiveness has  been  variously  estimated.  Some  have  held 
that  it  is  an  essential  to  maximum  effort,  while  many  oth- 
ers are  convinced  that  the  national  income  is  thereby  re- 
duced. 

Sidgwick,  the  noted  English  ethicist  and  economist,  be- 
lieved the  former.  He  feared  for  the  British  level  of  liv- 
ing if  the  masses  were  to  get  their  rights  as  the  socialists 
saw  them.  He  wrote :  "  Any  great  equalization  of  wealth 
would  probably  dimmish  the  accumulation  of  capital  on 
which  the  progress  of  industry  depends ;  and  would  de- 
teriorate the  administration  of  the  capital  accumulated." 
He  was  afraid,  for  one  thing,  of  the  people  spending  their 
additional  earnings  due  to  a  redistribution  of  wealth.  He 
no  doubt  thought  that  improvidence  would  get  the  better 
of  common  people  and  induce  them  to  keep  servants  or 
make  gluttons  of  themselves.  The  capital-fund,  as  de- 
fined by  competitive  economics,  would  thus  shrink,  and 
gradually  the  flow  of  concrete  goods  would  end. 

3  Sidgwick,  H.,  "  Elements  of  Politics,"  p.  153. 


172  THE  LIMITS  OF  SOCIALISM 

Whether  this  is  a  good  view  to  take  of  the  habits  of  the 
average  man  is  hard  to  say.  We  have  no  direct  evidence 
to  prove  that  socialism  will  decidedly  increase  the  product- 
ive powers  of  the  nation.  But  on  the  other  hand  we 
know  of  sumptuary  laws  and  of  education  which  have 
taught  men  moderation  without  hurting  their  feelings. 
In  the  end  there  will  not  be  a  great  deal  of  waste  because 
the  ratio  of  capital  to  consumption  goods  is,  with  the  ex- 
ception of  a  good  possibility  for  extending  personal  serv- 
ices almost  indefinitely,  fairly  constant.  It  is  really  im- 
possible to  provide  luxuries  for  those  with  large  incomes 
unless  they  themselves  or  others  save,  that  is  see  to  the 
production  of  a  suitable  amount  of  capital  which  is  to 
turn  out  the  luxuries.  Only  a  few  may  at  any  given  time 
draw  heavily  upon  their  total  nominal  income  in  dollars 
and  cents,  the  majority  must  be  content  with  investments, 
so  the  future  flow  of  consumables  may  grow. 

As  against  this  fact,  however,  we  must  acknowledge 
that  personal  services  may  easily  expand  unduly,  for 
which  reason  partly  an  extreme  concentration  of  wealth  is 
undesirable.  As  has  been  shown  elsewhere,  socialism  will 
increase  our  labor-power  chiefly  by  making  use  of  this 
principle.  The  hosts  of  men  and  women  now  employed 
in  the  rendering  of  trifling  services  will  be  turned  into 
socially  necessary  workers,  providing  services  more  in 
keeping  with  the  needs  of  the  great  majority,  and  rentiers 
will  have  to  work  also. 

As  socialists  have  often  remarked,  there  are  at  present 
too  many  idlers  feasting  at  a  table  set  by  others.  Heirs 
and  prospective  heirs,  the  children  of  wealthy  folk,  grown 
up  men  and  women,  and  not  least  of  all  married  women 
in  affluent  circumstances,  these  are  the  parasites  who  de- 
pend upon  others  for  their  fat  living.  \It  is  not  the  money 
earner  himself  who  spends  vast  sums,  out  his  family  or 


THE  LIMITS  IN  DISTRIBUTION          173 

relatives.  \  Big  producers  at  all  times  have  been  compara- 
tively sm^ll  consumers.  Those  who  give  most  take  the 
least,  and  gladly  continue  to  give  their  services,  or  at  any 
rate  to  follow  their  gainful  pursuits.  But  comumption 
by  proxy  becomes  a  pleasant,  because  respectable,  kind  of 
a  debauch.  Habitual  idleness  thus  perpetuates  itself  from 
one  generation  to  the  next. 

Let  us  admit  then  that  the  socialist  possibly  has  exag- 
gerated the  effects  of  the  leisure  class  on  national  out- 
put. But  if  so  he  seems  to  have  the  better  of  it  when  de- 
fending his  principle  of  collectivistic  enterprise  against 
the  plea  for  competition  which  the  friends  of  the  present 
regime  usually  bring  up  first. 

It  has  been  argued  that  to  decrease  profits  will  mean  a 
lowering  of  our  level  of  living,  because  the  .average  busi- 
nessman will  not  do  his  best  unless  he  can  keep  all  he  can 
get.  The  champions  of  ruthless  individualism  have  again 
and  again  reverted  to  this  position.  It  has  seemed  to 
them  axiomatic  that  the  present  regime  is  efficient  because 
the  ablest  are  prodded  on  by  rewards  which  socialism 
would  withhold  from  them.  If  this  be  so,  then  of  course 
competition  should  have  no  fetters,  since  the  reduction  of 
our  income  hampers  progress,  as  socialists  admit. 

§  3.  Private  Property  and  Efficiency. —  But  what  is 
competition,  and  what  has  the  past  taught  us  in  this  re- 
spect? It  is  evident  that  much  depends  on  the  definition 
of  our  term,  to  say  nothing  of  the  bearing  of  experience 
on  our  topic. 

Now,  in  the  first  place,  one  may  retort  with  the  irrefut- 
able fact  that  the  majority  of  the  producers  lack  that 
supposedly  necessary  incentive  already,  The  "g 
jority  of  workers  for  a  wage  cannot  increase  income  as 
they  increase  their  output.  Their  day's  work  is  roughly 
fixed,  and  their  day's  income  is  in  most  cases  fixed  exactly. 


174  THE  LIMITS  OF  SOCIALISM 

Piecework  has  been  tried  out,  and  many  produce  under 
that  system  to-day.  But  it  has  not  always  raised  produc- 
tivity, nor  has  the  advantage  of  a  larger  output  invari- 
ably offset  the  disadvantages  in  other  lines.  The  indirect 
effects  of  speeding,  whether  urged  by  profit-sharing  or  by 
piece  wages,  have  set  both  labor  and  legislators  against  it. 

But,  for  that  matter,  it  would  be  difficult  to  prove  that 
men  have  produced  poorly  because  they  received  a  con- 
tractual income.  Wages  have  not  prevented  us  from  rais- 
ing our  level  of  living  more  in  the  nineteenth  century  than 
before.  Many  hundreds  of  thousands  have  for  years 
worked  for  salaries  and  done  their  best.  Corporations 
have  submitted  to  a  restriction  of  earnings  in  percentages 
of  their  investment  and  not  ceased  therefore  to  serve  the 
public.  We  have  minimum  prices  and  maximum  wages, 
franchise  taxes  for  net  profits  above  a  normal  interest  rate, 
and  fees  absolutely  independent  of  demand  or  of  values 
delivered.  If  a  physician  can  pursue  his  practice  without 
charging  all  the  traffic  will  bear,  why  should  not  a  busi- 
ness firm  selling  rawstuffs  or  finished  goods?  It  would 
seem  that  either  we  have  to  divide  the  population  into  two 
groups,  namely  the  greedy  and  the  generous,  or  else  re- 
define our  concept  of  competition.  If,  and  to  the  extent 
that,  it  is  true  that  some  will  exert  themselves  only  for 
the  pelf  to  be  gained,  while  others  find  their  reward  in 
something  besides  pelf,  incomes  should  be  uncontrolled  in 
one  case,  and  curbed  in  another.  But  this  is  not  the 
most  obvious  way  of  meeting  our  dilemma. 

Rather  it  should  be  plain  that  competition  involves 
much  more  than  a  lust  for  maximum  earnings.  Hodgskin, 
whom  we  have  quoted  several  times  before,  wrote :  "  I  can 
understand  how  a  right  to  appropriate  the  produce  of 
other  men,  under  the  name  of  interest  or  profit,  may  be  a 
stimulus  to  cupidity,  but  I  cannot  understand  how  lessen- 


THE  LIMITS  IN  DISTRIBUTION          175 

ing  the  reward  of  the  laborer,  to  add  to  the  wealth  of  the 
idle,  can  increase  industry  or  accelerate  the  progress  of 
society  in  wealth."  This  is  one  kind  of  rebuttal  the 
socialist  might  use.  But  the  more  scientific  one  is  a  cor- 
rect analysis  of  the  competitive  spirit. 

Competition  is  not  simply  a  struggle  for  riches,  as 
economics  frequently  has  made  it  out  to  be ;  nor  is  it  a 
trial  of  the  pyx  by  which  the  pure  is  separated  from  the 
impure. 

The  fittest  in  society  is  not  the  fittest  among  animals. 
This  is  the  first  now  universally  recognized  fact  which  the 
individualist  has  to  remember.  Evolution  is  not  progress, 
for  man  has  developed  powers  of  speech  and  of  reasoning, 
of  memory  and  of  associations,  which  permitted  him  to 
master  nature  rather  than  live  by  exploiting  his  fellowmen. 
When  man  began  to  unfold  his  learning  faculties  and  to 
wrest  from  nature  her  innermost  secrets  he  was  in  a  fair 
way  to  substitute  surplus  for  deficit,  and  to  displace  in- 
ternecine strife  by  intellectual  research. 

Or  we  may  put  the  matter  thus. 

Competition  originally  had  to  do  with  sex  and  self 
preservation  in  a  struggle  for  sheer  existence,  but  later  on 
other  factors  became  more  important.  Altruism  had  al- 
ways been  a  natural  concomitant  of  sexual  reproduction 
and  of  parental  responsibilities.  From  it  the  first  un- 
selfish instincts  must  have  gathered  strength.  But  gradu- 
ally the  enlargement  of  the  individual's  environs  developed 
group  consciousness  in  addition  to  blood  ties.  The  selfish 
instincts  of  pugnacity  and  acquisitiveness  which  relate 
closely  to  the  reproductive  functions  were  tempered  by 
feelings  for  others.  A  solidarity  of  interests  arose  and 
was  cultivated  by  the  requisites  of  production.  Division 
of  labor  and  technical  cooperation  could  mean  nothing 
*  Hodgskin,  op.  cit.,  p.  254. 


176  THE  LIMITS  OF  SOCIALISM 

else,  however  stimulating  in  some  respects  it  was  for  the 
most  individualistically  inclined.  \  As  the  material  level 
rose  the  so-called  moral  did,  too.''  Passion  came  to  be 
blended  with  compassion,  self-assertion  with  a  suscepti- 
bility to  the  approval  of  outsiders,  and  the  vying  for 
booty  with  the  penchant  for  achievement.  The  whole 
course  of  civilization  is  a  conversion  of  the  physical  self 
into  a  social  self,  and  of  products  into  personality. 

The  cave-man  is  still  with  us,  but  not  in  large  numbers. 
He  is  likely  to  be  a  movie  hero,  or  a  felon  in  prison.  The 
pirate  of  old  has  turned  profiteer  perhaps,  but  most  of  the 
profiteers  are  producers  nonetheless.  The  marauders  of 
the  economic  world  no  longer  pillage  and  destroy  merely ; 
they  also  build  or  replace  in  part  what  they  have  undone. 
The  chieftain  who  led  his  hordes  into  the  bloody  fray  has 
given  way  to  the  business  magnate  who  excels  in  the  man- 
aging of  labor  forces.  Not  all  highwaymen  have  died 
out  to  leave  us  unmolested,  but  the  surviving  must  be 
clever  to  elude  the  law,  or  they  must  give  a  quid  pro  quo 
of  some  kind. 

In  other  words   competition,  if  it  ever  was  merely   a 
struggle  for  loot,  has  long  ceased  to  be  such.     In  modern 
times  it  has  increasingly  meant  a  desire  to  create  as  well 
as  a  bent  for  acquisition.     The  hardest  fighters  do  not^yv, 
want  the  enjoyment  of  their  possessions.     They  do  not 
feast  at  banquets  or  spend  their  day  in  carousals.     The 
most    competitively    spirited    compete    for    power   which 
wealth  brings,  for  the  prestige  that  it  means,  but  also  for  t 
the  joy  of  the  game. 

We  love  to  compare  our  deeds.  Competition  is  this 
vying  for  superiority  regardless  of  emoluments.  It  is  not 
merely  the  seeking  after  rare  things  money  can  buy. 
Some  scarcities  not  in  the  money  market  are  equally  en- 
trancing, and  most  of  them  stand  for  social  order. 


THE  LIMITS  IN  DISTRIBUTION          177 

People  do  their  utmost  because  energy  needs  a  vent.  Or 
they  plod  along  from  habit,  doing  day  by  day  their  duty, 
perhaps  unthinkingly.  Habit  and  enerfiyT  pride  in 
achievements  and  the  instinct  for  approval,  these  are  the, 
elements  in  competition  that  count  more  in  the  aggregate 
than  the  lust  for  profits. 

Men  wish  to  identify  themselves  with  a  piece  of  work. 
They  crave  leadership  or  distinction  measurable  by  indi- 
vidual creations.  Socialism,  therefore,  should  put  a 
premium  of  praise  and  a  badge  of  distinction  on  the  ex- 
ceptional deed.  This  all  statesmanship  will  respect,  and 
within  a  limited  sphere  always  has  applied.  If  under 
socialism  the  exceptional  producers  are  permitted  to  do 
their  own  work,  to  follow  up  their  conceptions  and  en- 
deavors, to  bring  to  public  notice  what  they  have  done, 
then  the  curtailment  of  profits  will  do  no  great  harm.  It 
will  not  restrain  the  most  meritorious,  though  some  may 
desist  at  the  outset.  Socialists  should  make  sure  of  con- 
necting men  with  their  work  wherever  possible  and  in 
such  a  way  that  the  two  may  be  identified.  It  is  this 
which  the  finest  of  men  will  wish.  Incentive  to  produce  by 
mastering  the  subject,  and  by  demonstrating  the  results  to 
an  admiring  or  at  least  to  a  sympathetic  public  —  such 
is  the  most  fundamental  significance  of  competition.  Men 
of  preeminence  always  will  lead.  JThe  fiffht  to  lead  and 
to  do  substantially  as  we  please  in  creating  values  will 
remain  for  all  times  to  come.  We  cannot  abolish  it  by  a 
fiat  of  law.  But  the  right  to  earn  as  much  as,  and  by 
any  method,  we  please  is  bound  to  be  circumscribed  the 
more,  the  more  advanced  scientific  thought. 

It  might  be  objected  that  taxation  can  take  the  place  of 
socialization,  so  our  present  regime  may  be  left  intact. 
This  thought  has  often  been  broached,  and  of  course  con- 
tains much  truth.  But  it  should  also  be  remembered  that 


178  THE  LIMITS  OF  SOCIALISM 

the  final  result  of  greatly  increased  taxation  cannot  but 
be  a  curb  to  individual  enterprise. 

Taxes  are  never  the  most  desirable  means  for  rectify- 
ing distributive  errors,  for  to  take  taxes  is  to  admit  that 
somebody  owns,  and  this  implied  or  explicit  admission  of 
earnings  on  the  part  of  the  tax  payer  is  an  injustice  to 
the  bulk  of  the  wage  earners.  In  the  second  place,  tax- 
ation is  a  roundabout  way  of  leveling  incomes,  much  as 
Prohibition  once  labored  indirectly  because  it  agitated 
against  consumption  long  before  it  argued  against  the 
production  of  liquors.  Indirect  methods  of  that  sort 
mean  leakage  and  lost  motion.  They  mean  uncertainties 
and  protests  that  are  falsely  grounded. 

But,  in  the  third  place,  it  is  difficult  to  see  what  the 
central  or  local  governments  would  do  with  the  receipts  if 
they  were  to  take  from  the  rich  by  taxes  what  socialism 
wishes  to  give  the  masses  of  the  people  more  directly.  A 
revenue  four  or  five  times  as  large  as  now  needed  for 
routine  administration  would  call  for  investments  in  an 
unusual  way.  In  the  United  States,  for  instance,  the 
total  public  revenue,  federal  and  local,  was  for  the  year 
1912  equal  to  about  six  per  cent,  of  the  social  dividend. 
For  every  dollar  of  national  income  the  authorities  col- 
lected six  cents  in  taxes.  If  the  socialistic  principles  of 
leveling  were  to  be  realized  by  taxation  the  revenue  would 
approximate  twenty  per  cent,  or  more  of  the  total  national 
income.  This  would  possibly  look  like  a  nice  gain  for  both 
government  and  the  poor  man  who  was  taxed  little  or  noth- 
ing. But  what  would  be  done  with  the  receipts?  They 
would  either  have  to  be  redistributed  directly  among  the 
most  needv,  or  they  would  mean  a  vast  extension  of  gov- 
ernment functions  with  the  result  that  enterprise  would 
increasingly  become  a  public  business.  Taxation  conso- 


THE  LIMITS  IN  DISTRIBUTION          179 

nant  with  the  distributive  norms  of  socialism  would  thus 
lead  to  government  ownership  anyway. 

|  4.  Pricing  under  Socialism. —  Socialism,  however, 
would  mean  more  than  the  socialization  of  capital.  It 
would  not  merely  prevent  the  rich  from  becoming  richer, 
but  in  addition  it  plans  a  revaluation  of  goods  and  serv- 
ices, so  that  none  can  earn  the  hugejsums  which  now  are 
said  to  represent  their  "  product."  Under  socialism  there 
will  be  no  inheritance  of _ capital, and .only  limited  inheri- 
tance o^^onsumer^goods.  This  source  of  rentals  then 
being  taken  away,  and  the  work  of  all  being  valued  at  a 
newT^cale,  incomes  would  not  "vary  "a  great  deal,  though 
some  differences  would  continue  to  exist.  But  at  any  rate 
the  incomes^  would  all  be  earned.  Rent,  interest,  and 
profits  would  have  no  place  in  the  new  regime.  All  pro- 
ducers would  be  wage-earners..  All  workers,  no  matter 
what  their  profession  or  trade,  would  receive  wages  by 
stipulation  with  the  government.  \The  aleatory  gains  of 
the  entrepreneur  would  end,  and  contractual  earnings 
would  alone  prevail. 

It  would  of  course  be  possible  t_Q  ration  out  the  goods 
which  each  worker  or  head  of  a  family  is  entitled  to. 
Instead  of  paying  him  in  token  money  with  which  to  pur- 
chase his  needs  he  could  be  paid  in  amounts  of  commodi- 
ties constituting  the  value  of  his  labors.  In  this  way  the 
government,  or  the  locally  managed  public  industries, 
would  know  exactly  what  to  produce  of  each  kind  of  good, 
and  the  possibilities  of  foolish  spending  were  removed. 
To  apportion  income  in  this  manner  has  some  advantages 
particularly  when  we  are  dealing  with  irresponsible  par- 
ties. But  it  also  offers  great  administrative  difficulties, 
and  besides,  it  has  not  been  seriously  proposed  by  social- 
ists. It  is  intended,  if  one  may  judge  by  the  dominant 


180  THE  LIMITS  OF  SOCIALISM 

tone  of  writings  on  this  neglected  subject,  to  retain  the 
use  of  money  in  so  far  as  it  serves  simply  as  a  medium  of 
exchange.  Money  will  be  chiefly  a  claim  to  values  with- 
out  having  itself  intrinsic  value.  Paper  money  will  pre- 
dominate. It  will,  like  poker  chips  in  a  game  of  cards, 
represent  titles  to  real  values,  but  will  have  none  itself. 
And  trade  thus  will  mean  only  a  moving  of  goods.  Com- 
merce will  at  bottom  mean  regional  distribution  involving 
the  transportation  of  commodities.  The  public  central 
warehouses  will  supply  the  stores  at  which  the  consumer 
cashes  in  his  token  money.  The  exchange  of  goods  for 
services  rendered  will  thus  be  simplified,  and  much  dupli- 
cation of  effort  stop. 

But  at  what  rates  will  goods  exchange?  Price  is  a 
ratio  of  exchange.  If  a  bushel  of  wheat  sells  to-day  for 
two  dollars  which  buy  five  pounds  of  meat,  the  price  of  a 
bushel  of  wheat  is  five  pounds  of  meat.  Value  is  price 
when  values  are  exchanged.  Price  is  the  amount  of  one 
article  given  for  a  unit  amount  of  another,  that  unit  be- 
ing most  commonly  known  as  money.  The  dollar,  e.  g., 
is  the  unit  in  terms  of  which  the  American  people  meas- 
ure—Ujeir  exchange  ratios. 

Their)  are  jour  possibilities  of  pricing^  one  of  which 
socialism  will  adopt.  We  may  fix  the  price  of  commo- 
dities, but  not  the  wages  paid  for  services.  We  may  fix 
the  wage,  but  not  the  price  of  commodities.  We  may  fix 
both  prices  for  commodities  and  wages.  And  finally  we 
may  fix  neither  prices  nor  incomes,  that  is  wages. 

At  last  analysis  of  course  all  prices  are  incomes,  and 
vice  versa.  If  I  buy  a  pair  of  shoes  I  have  to  pay  a 
price,  and  if  a  clerk  sells  them  to  me  he  also  charges  his 
employer  a  price  for  his  work.  The  employer  calls  the 
TV  age  of  the  clerk  a  price  which  forms  part  of  his  busi- 
ness expenses ;  but  the  clerk  speaks  of  wages  as  income. 


THE  LIMITS  IN  DISTRIBUTION          181 

To  him  it  is  coming  in,  though  for  the  owner  of  the  store 
it  is  going  out.  Income  and  outgo  constitute  couples 
that  in  practice  cannot  be  separated  into  individual  acts. 
But  according  to  viewpoint  one  and  the  same  value  is 
either  price  or  income.  A  price  contains  the  incomes  of 
all  those  involved  in  the  creation  of  the  article  back  of  the 
price.  In  a  pair  of  shoes,  for  instance,  are  incorporated 
many  incomes,  which  in  minute  amounts  went  to  all  those 
who  helped  make  the  shoe,  from  farm  hand  tending  the 
steer  that  furnished  the  hide  to  the  clerk  in  the  store  sell- 
ing the  finished  article. 

At  present  the  great  bulk  of  prices,  i.  e.,  of  prices  for 
commodities  and  of  incomes  for  services,  are  determined 
competitively.  We  have  an  open  market,  and  let  the 
forces  of  supply  and  demand  decide  what  a  commodity 
shall  sell  for.  This  is  the  theory  on  which  the  science  of 
economics  proceeded  to  correlate  product  ^nd  income,  and 
in  large  measure  this  is  actual  fact.  VHowever,  purely 
competitive  pricing  has 'ceased  in  many  fiems  of  production 
and  exchange.  Monopoly  has  supplanted  competition, 
and  public  regulation  has  put  limits  to  both  competitive 
and  monopoly-pricing.  We  might  therefore  acknowledge 
frankly  that  to-day  public  control  of  prices^js  gaining, 


though  competition  still  holds  part  of  the  field.  Freight 
rates  and  the  price  of  coal  or  bread  are  publicly  fixed. 
Urban  traction  companies  may  not  earn  more  than  a  cer- 
tain per  cent,  on  their  investment,  and  employees  of  the 
government  of  course  have  as  such  a  publicly  set  annual 
income.  If  necessary  their  salaries  will  be  adjusted  to 
labor  conditions  in  private  business,  but  roughly  speaking 
the  government  fixes  a  wage  without  regard  to  competi- 
tion from  outside.  Against  this  rule,  however,  must  be 
placed  the  unionization  of  labor,  the  upshot  of  which  is 
the  determination  of  all  wages  by  agreement  with  the  em- 


182  THE  LIMITS  OF  SOCIALISM 

ployer.  Hence  a  growing  part  of  wage-earners  reduces 
the  force  of  individual  competition  and  puts  in  place  of  it 
what  socialism  virtually  aims  at,  namely  payment  in  ac- 
cord with  public  opinion.  A  socialistic  wage-law  will, 
like  any  act  of  legislature,  meet  the  sanction  of  the  ma- 
jority, but  public  opinion  will  be  guided  from  the  head- 
quarters of  business. 

Incomes  under  socialism  will  be  fixed  per  work  hour  or 
per  year,  but  the  prices  of  commodities  will  vary  with  de- 
mand just  as  they  do  to-day.  This  seems  to  be  the  plan 
advocated  by  most  defenders  of  the  new  order.  Consumers 
will  be  allowed  to  bid  for  goods  as  they  do  now,  but  in  the 
first  place  there  will  be  minima  and  maxima,  and  in  the 
second  place  the  effect  upon  production  will  not  be  the 
present  one,  because  incomes  will  be  put  more  nearly  on  a 
par  with  each  other. 

From  the  standpoint  of  adjustment  of  supply  to  de- 
mand, however,  the  free  pricing  of  goods  will  under  social- 
ism have  nothing  ahead  of  the  now  prevailing  system. 
Nor  does  there  seem  any  way  out  of  the  difficulty  unless 
a  rationing  of  goods  takes  the  place  of  purchase  with 
money  paid  by  the  government  for  services.  If,  namely, 
the  government  sets  prices  too  high  the  people  may  not 
buy,  or  buy  but  little,  so  that  great  stocks  are  left  at  the 
end  of  the  year  which  cannot  be  used  up.  But  if  prices 
are  set  too  low,  the  demand  will  exceed  supplies  on  hand, 
and,  unless  maxima  prices  are  decreed,  a  ruthless  bidding 
will  set  in.  Even  though  incomes  are  equally  or  fairly 
evenly  assigned,  many  then  will  still  go  without  the  goods 
they  should  have  as  part  of  a  right  standard  of  living. 
Tastes  differ  enormously.  The  ideal  of  public  welfare  can 
only  be  guarded  by  specifying  all  those  articles  which  are 
part  of  a  normal  level  of  living,  and  the  use  of  which  in 
stated  maximum  and  minimum  amounts  is  publicly  recom- 


THE  LIMITS  IN  DISTRIBUTION  183 

mended  or  ordered.  But  in  either  case  supply  and  de- 
mand will  not  agree  closely.  And  if  no  price  fixation  is 
planned  the  discrepancy  will  be  even  greater.  There  will 
always  be  too  much  of  some  commodities  and  not  enough 
of  others.  It  will  not  be  possible  to  ascertain  beforehand 
what  people  want.  The  averages  of  demand  will  be  dis- 
covered slowly,  and  perhaps  change  as  fast  as  they  have 
been  tabulated  for  use  in  production.  At  present  a  deli- 
cate mechanism  of  exchange>  wholesale  and  retail,  attends 
to  the  equilibration  which  is  never  perfect,  but  moves  not 
too  far  from  the  median  line  of  adjustment.  We  have 
trade  journals  and  government  crop  reports,  international 
news  service  and  statistical  surveys  privately  conducted. 
We  have  brokers  and  bourses  looking  after  the  fluctuations 
of  supply  and  demand.  There  is  buying  and  selling  in 
the  harvest  field,  and  of  harvested  crops  for  delivery  many 
months  ahead.  And  most  important  of  all,  we  have  the 
pressure  of  rising  prices  and  the  license  of  falling  prices, 
by  which  device  demand  is  suited  to  supplies  and  price  is 
suited  to  willingness  to  pay,  the  poorest  dropping  out  of 
the  market  first. 

It  is  not  likely  that  socialistic  organization  will  do 
much  better  in  this  respect,  than  the  one  now  in  effect. 
It  will  be  far  more  just  to  the  average  consumer,  but  it 
will  not  avoid  altogether  the  waste  attending  the  distribu- 
tion of  goods  over  large  areas,  among  many  millions  of 
people.  Nor  will  it  be  easy  to  obtain  rawstuffs  at  short 
notice  from  abroad,  in  case  demand  moves  that  way,  or  to 
find  labor  in  the  home  market  to  increase  the  supply  of 
particular  articles.  The  more  socialism  seeks  to  inter- 
nationalize levels  of  living,  the  more  it  will  have  to  reckon 
with  waste,  and  with  sacrifices  for  those  nations  which  are 
most  prosperous  and  technically  best  administered. 

§  5.  Costs  under  Socialism. —  In  so  far,  however,  as 


184  THE  LIMITS  OF  SOCIALISM 

demand  is  not  to  fix  the  price  of  commodities  another  prin- 
ciple will  doubtless  be  invoked,  and  socialists  have  often 
spoken  of  costs  in  this  connection.  It  has  by  some  been 
hinted  that  goods  will  be  sold  at  cost,  and  by  others  that 
costs  will  measure  roughly  the  price  of  goods.  But  how 
far  may  this  rule  really  be  enforced? 

As  to  sales  at  cost,  the  phrase  is  misleading  if  it  is  to 
convey  the  thought  of  prices  below  the  present,  because  no 
profits  will  be  made.  The  sale  at  cost  would  be  no  gain, 
because  socialistic  costs  would  comprise  more  or  less  than 
competitive  costs,  according  as  we  look  at  them. 

In  general  cost  is  a  ratio.  Budgets  are  ratios  of  in- 
come and  outgo,  and  cost  and  return  are  the  two  aspects 
of  this  mutual  relation.  If,  for  instance,  I  lose  one  bushel 
of  seedwheat  in  producing  five  bushels  of  harvested  wheat 
I  may  say  that  the  cost  of  the  five  bushels  is  the  one 
bushel  put  .into  the  ground.  Cost  is  outgo  measured  in 
terms  of  income,  and  the  rate  of  return  (or  the  profit) 
is  income  compared  with  outgo. 

Cost  may  be  expressed  either  in  goods,  by  weight  and 
volume,  or  in  money.  The  example  of  wheat  just  given  is 
one  of  cost  measurement  by  weight  and  tale.  But  in- 
stead of  referring  the  five  bushels  of  wheat  harvested  to 
one  bushel  of  seed  I  might  also  have  reckoned  the  return 
by  the  time  it  took  to  produce  them.  I  might  have  said : 
I  produced  five  bushels  in  four  months.  Next  year  I  shall 
try  to  produce  them  in  three  months,  and  I  shall  then 
have  increased  my  rate  of  return  or  decreased  my  costs. 
The  time  element  evidently  is  sometimes  important  for 
cost  accounting,  and  it  figures  prominently  in  national 
budgets.  But  we  might,  in  the  third  place,  measure  rates 
of  return  or  costs  by  income  per  capita  of  the  popula- 
tion. If  the  output  of  wheat  per  capita  is  ten  bushels  in 
one  year,  and  twelve  the  next,  we  may  call  this  gain  the 


THE  LIMITS  IN  DISTRIBUTION          185 

equivalent  of  cost  reduction.  We  may  feel  that  it  reduces 
our  cost  of  living.  We  may  measure  our  purchasing 
power  in  that  way,  and  feel  downcast  or  elated  according 
to  productiveness  per  average  inhabitant. 

But  if  we  pass  over  to  the  competitive  norm,  the  rate 
of  return  in  concrete  goods  becomes  less  significant  than 
the  income  of  dollars  and  cents  per  outgo  of  the  same. 
The  farmer,  thus,  may  not  care  whether  he  grows  more 
wheat  per  acre,  or  even  more  wheat  per  outlay  in  goods 
and  services.  He  may  simply  ask:  What  will  I  get  in 
money  for  money  spent?  If  I  grow  less  wheat,  but  sell  it 
at  a  higher  price  I  shall  have  raised  my  profits.  My 
costs  will  be  relatively  lower.  My  income  having  grown 
while  my  expenses  remained  constant,  my  expenses  have 
practically  shrunk. 

The  correct  analysis  of  cost  thus  leads  us  to  the  con- 
clusion which  Marx  himself  could  not  escape,  but  on  the 
contrary  placed  candidly  before  his  readers.  To  wit, 
socialism  cannot  decrease  costs  unless  it  raises  efficiency. 
It  will  not  really  confer  a  benefit  upon  the  consumer, 
though  nominally  it  sells  commodities  at  cost.  The  list 
of  costs  will  have  changed.  The  names  may  not  be  the 
old.  But  the  ratio  of  income  to  outgo  for  the  nation  as 
a  whole  is  no  better  except  invention  and  organization 
reduce  the  outgo  of  effort  and  material  relative  to  returns 
in  material. 

There  will  be  probably  no  insurance  of  capital  such  as 
we  know  to-day.  There  will  be  no  profits  going  to  a  small 
group  of  entrepreneurs.  But  there  will  be  the  outgo  of 
raw-materials,  of  wages  in  the  shape  of  goods,  most  of  it 
being  paid  to  the  producers  of  concrete  commodities  or 
of  personal  services,  but  some  of  it  to  officials  looking 
after  the  non-economic  duties  such  as  maintenance  of  army, 
of  the  department  of  justice,  etc.  There  will  furthermore 


186  THE  LIMITS  OF  SOCIALISM 

be  reserves  for  unforeseen  losses,  for  replacement  of  capi- 
tal goods,  for  expansion  of  business  when  and  where  nec- 
essary, and  for  charity  and  pensions.  The  cripples  in 
body  or  mind  will  be  taken  care  of,  and  the  aged  will  re- 
ceive regular  remittances  which  will  be  paid  out  of  prices 
and  products  figuring  in  socialistic  costs. 

But  the  costs,  though  determinable  in  general,  will  not 
be  measurable  for  a  particular  article.  The  use  of  ma- 
chinery precludes  such  a  possibility,  and  besides,  there  is 
the  joint  product,  the  by-product,  for  which  costs  cannot 
be  computed  except  very  indirectly.  The  imputation  of 
values  to  services  and  to  commodities  will  be  as  arbitrary 
under  socialism  as  it  ever  was.  The  number  of  hours  it 
took  to  create  a  certain  article  or  its  value  will  in  most 
cases  not  be  ascertainable,  since  many  men  have  worked 
together  and  simultaneously  to  produce  it,  to  say  nothing 
of  overhead  expenses  and  the  costs  in  work  hours,  of 
machinery  and  management  and  of  particular  inventions 
basic  to  the  productive  act. 

Prices,  in  fine,  will  be  fixed  somewhat  arbitrarily  to 
agree  with  the  ideals  of  living.  The  socialistic  standard 
of  living  will  keep  some  articles  cheap  so  all  may  buy  them, 
and  raise  the  price  of  high  grade  luxuries,  supposing  they 
are  produced  at  all. 

§  6.  The  Socialistic  Principle  of  Distribution. —  To 
assure  the  average  man  a  decent  livelihood  prices  for  serv- 
ices too  will  be  put  nearly  on  one  plane.  The  revaluation 
will  not  only  cheapen  necessities,  but  it  will  give  the 
humblest  laborer  a  return  in  wages  sufficient  for  all  ap- 
proved wants.  Socialism  will  measure  productivity  by 
work  hours.  The  worker,  with  certain  exceptions,  will 
be  paid  according  to  the  time  he  puts  in  at  the  work 
bench.  It  will  be  assumed  that  the  rate  of  work,  that  is 
of  actual  achievement,  is  for  men  in  like  occupations  uni- 


THE  LIMITS  IN  DISTRIBUTION          187 

form,  even  though  some  differences  may  in  practice  ap- 
pear. No  other  method  for  valuating  services  can  exist 
under  socialism.  Ten  hours  of  work  will  be  worth  twice 
as  much  as  five  hours. 

Exceptions  will  do  justice  to  striking  differences  in  the 
nature  of  work  done.  Inventors  and  novelists,  for  in- 
stance, will  be  rewarded  in  a  lump  sum,  or  on  the  install- 
ment plan,  for  creations  of  unusual  and  abiding  merit. 
Managers  will  receive  more  than  underlings.  Those 
highly  trained  in  science  or  skilled  in  handicrafts  will  have 
more  to  spend  than  crude  labor.  But  the  latter  will  at 
least  have  enough  for  a  living  standardized  by  the  ob- 
jective tests  of  individual  and  social  welfare.  It  will,  in 
general,  be  argued  as  Adam  Smith  did  a  hundred  and  fifty 
years  ago,  that  "  by  nature  a  philosopher  is  not  in  genius 
and  disposition  half  so  different  from  a  street  porter,  as  a 
mastiff  is  from  a  greyhound  — ."  5  This  viewpoint  will 
guide  the  socialist.  He  will  emphasize  resemblance  in  men 
more  than  their  differences.  He  will  seek  to  democratize 
effort  and  rights.  He  will  differentiate  with  care,  but 
tolerate  no  extremes  of  income.  Unlike  services,  but  ap- 
proximately like  pay  for  all !  The  brainiest  will  give,  and 
the  numskulls  will  take.  Those  who  now  by  mere  cunning 
and  astuteness  garner  riches  will  obtain  less.  What  they 
lack  in  creativeness  will  reduce  their  income  as  much  as 
now  the  possession  of  shrewdness  raises  it  above  the  aver- 
age. 

Distribution  according  to  need  will,  if  necessary,  take 
the  place  of  distribution  according  to  number  of  hours  at 
work.  The  least  gifted  will  get  more  than  their  product 
even  as  measured  by  socialism.  The  standard  of  living 
will  be  raised  for  the  masses.  It  will  include  many  items 

5  "Wealth  of  Nations,"  Book  I,  Chapter  2.  See  also  Thompson, 
W.,  "Inquiry  into  the  Principles  of  Distribution,"  p.  4. 


188  THE  LIMITS  OF  SOCIALISM 

not  now  figuring  in  a  wage-earner's  budget,  and  it  will  allot 
some  of  the  essentials  in  a  somewhat  better  proportion 
than  seems  now  practicable. 

A  Minimum  Wage  Board  recently  estimated  the  wage 
necessary  for  self-supporting  women  in  the  printing  in- 
dustry at  sixteen  dollars  a  week.  This  in  the  summer  of 
1919 !  It  wished  to  be  just,  and  itemized  the  expenses  for 
each  class  of  wants.  It  did  the  best  it  could  to  allow  for 
all  essentials,  and  the  showing  is  not  bad  at  first  glance. 
But  when  one  notices  that  for  charity  and  organization 
(union-fee?)  each  it  allowed  per  year  five  dollars,  for  the 
services  of  physician  or  dentist  or  oculist  twenty-five,  and 
about  thirty  dollars  for  recreation,  amusement,  and  self- 
improvement,  one  wonders  how  much  solace  the  adjust- 
ment really  brought  to  the  workers.  Sixteen  dollars  a 
week  is  not  enough  by  any  norm  of  living  scientifically 
sanctioned.  It  may  be  the  best  possible  under  prevailing 
conditions,  but  it  cannot  satisfy  our  sense  of  fairness,  or 
the  demands  of  those  who  compare  individual  earnings 
with  the  aggregate  social  dividend. 

Actual  needs  are  not,  furthermore,  the  same  for  all 
people.  If  distribution  is  to  meet  needs  rather  than  pro- 
ductivity —  however  measured  —  the  differences  in  men 
and  their  occupations  will  have  to  be  duly  considered.  It 
will  be  one  of  the  trying  questions  of  socialism  to  find  out 
what  is  best  for  different  people.  When  the  variety  of 
goods  is  as  great  as  in  modern  times  the  individuality  of 
taste  has  plenty  of  room  for  exhibition.  There  will  be 
differences  according  to  temperament  or  sex,  according  to 
age  and  condition  of  body  and  mind,  according  to  climate 
and  season,  and  according  to  types  of  occupation.  It 
is  not  simply  a  matter  of  preferences  such  as  may  prop- 
erly be  ignored,  but  rather  of  habits  the  indulgence  in 
which  may  play  a  vital  part  in  the  productiveness  of  the 


THE  LIMITS  IN  DISTRIBUTION  189 

worker.  It  is  a  matter  first  of  educating  tastes  correctly 
by  positive  and  negative  means  of  control,  and  secondly 
of  adjusting  the  price  of  goods  so  that  variety  of  taste 
may  be  met  to  the  satisfaction  of  the  largest  number. 
For  this  reason  price  fixation  will  have  but  limited  use- 
fulness. It  will  be  the  duty  of  socialists  to  permit  the 
individual  as  much  freedom  in  his  purchase  as  seems  to 
agree  with  his  personal  welfare  or  with  social  efficiency, 
but  just  where  the  two  conflict  it  will  not  always  be  easy 
to  determine. 


CHAPTER  VIII 
THE  LIMITS  IN  CONSUMPTION 

§  i.  The  Nature  of  Consumption — The  subject  of 
consumption  occupies  a  peculiar  place  in  the  history  of 
economic  thought.  It  has  from  early  times  on  been  re- 
garded as  an  integral  part  of  the  science  of  economics, 
and  yet  its  treatment  has  varied  greatly.  Some  have 
viewed  consumption  as  a  value  aspect,  some  have  ap- 
pended it  to  treatises  with  the  thought  of  showing  the 
bearing  of  extravagance  on  public  revenues.  Some  have 
given  it  scant  courtesy  in  a  discussion  of  wages,  and  oth- 
ers have  made  it  the  key  to  distributive  facts  in  general. 

It  does  not  matter  what  consumption  means  to  the  or- 
thodox economist.  The  socialist  is  professedly  governed 
by  the  ethical  interpretation  which  Ruskin  summed  up 
sententiously  if  obscurely,  in  the  phrase :  "  There  is  no 
wealth  but  life."  What  life,  we  ask? 

Socialism  has  helped  men  to  find  the  objective  tests  of 
social  prosperity.  It  also  has  promoted  a  fitting  regard 
for  the  non-economic  expressions  of  economic  principles, 
it  some  limits  of  consumption  remain  that  socialists 
often  overlook,  or  deem  extraneous  to  their  subject  mat- 
Consumption  should  not  be  defined  primarily  as  a  loss  of 
values  incurred  m  ttie  production  Ol  6theT  Vklues,  Of  as1 
destruction  of  values  or  of  physical  things,  though  the 
destruction  of  food  for  instance  has  deep  significance  for 
the  farmer  who  must  replace  it  annually.  A  great  many 
commodities  are  not  used  up  in  the  act  of  consumption, 

190 


THE  LIMITS  IN  CONSUMPTION  191 

books  and  paintings  and  musical  compositions  and  radium 
and  water  power  being  examples.  On  the  other  hand, 
wealth  will  deteriorate  and  crumble  whether  we  use  it  or 
not,  and  values  competitively  calculated  may  shrink  and 
expand,  for  instance  the  price  of  stocks,  independent  of 
even  the  influence  of  weathering. 

The  real  meaning  of  consumption  from  a  social  stand- 
point is  use  for  reaction  physical  and  psychic.  Whatever 
we  react  upon  is  part  of  our  environment.  Whatever  we 
respond  to  has  been  in  a  sense  an  item  for  our  consump- 
tion. To  consume  by  responding  to  stimuli,  this  is  the 
gravamen  of  life.  Social  science  can  do  no  more  than 
study  the  relation  of  stimuli  from  without  and  from  within 
in  so  far  as  they  proceed  from,  or  influence,  our  wealth  re- 
lations. Consumption  is  the  act  of  absorbing  and  assimi- 
lating things  economic,  food  being  converted  into  blood, 
communication  into  knowledge  applied,  experiments  into 
habits  becoming  second  nature.  Consumption  is  the  pro- 
cess socially  directed  by  which  product  is  converted  into 
personality. 

§  2.  Consumption  and  Human  Nature —  But  the  ef- 
fetfts  of  consumption  on  human  nature  are  not  measurable 
in  the  degree  that  socialists  have  now  and  then  believed. 
The  economic  interpretation  of  history  may  emphasize 
the  relation  between  economic  income  and  psychic  outgo, 
but  it  should  not  induce  us  to  expect  the  impossible. 
Evolution  is  a  process  almost  too  slow  for  human  com- 
prehension. We  might  indicate  its  course  by  a  line  a  foot 
long  and  then  add  a  wee  speck  to  mark  the  historical 
epoch  of  which  man  is,  through  records  more  or  less  re- 
liable, a  witness.  The  momentum  of  that  long  line  of 
tendencies  is  so  great  that  no  one  century  of  reform  can 
overcome  it.  We  must  not  count  on  the  mutability  of 
human  nature,  because  eons  of  time  have  gradually  made 


192  THE  LIMITS  OF  SOCIALISM 

it  what  it  is.  The  economic  interpretation  of  the  past  is 
right  when,  judging  by  present  experiences,  it  traces  an 
interrelation  between  environment  and  man,  between  food 
conditions  and  physique  or  mental  development;  but  it 
errs  if  it  ascribes  to  our  historical  economics  an  influence 
over  the  shaping  of  human  traits.  These  traits  are  much 
older  than  history.  They  cannot  be  re-made  by  environ- 
mental control,  but  only  be  used  in  such  ways  as  will  suit 
the  needs  of  the  moment. 

Socialism  will  not  change  human  nature,  though  it  turn 
upside  down  the  present  order  of  things.  The  La- 
marckian  thought  of  the  transmission  of  acquired  charac- 
ters has  not  so  far  met  with  a  cordial  reception,  though 
it  has  been  put  to  many  tests  and  made  some  friends 
among  authorities.  For  one  thing,  socialism  is  little  af- 
fected by  the  acceptance  or  rejection  of  Lamarckianism ; 
for  another  the  doctrine  is,  in  its  original  and  most  con- 
sequential form,  discarded  by  modern  biology. 

Socialists  like  social  scientists  in  general  can  afford  to 
ignore  the  Lamarckian  idea  because  it  revolves  about  pe- 
riods of  time  in  which  contemporary  science  is  not  directly 
interested.  If  acquired  traits  were  immediately  hered- 
itary in  a  determinable  way  the  socialist  would  have  to 
create  his  economic  environment  for  each  generation  anew, 
so  as  to  offset  what  traits  might  have  been  transmitted 
from  parent  to  offspring.  Either  he  does  this,  or  he  must 
stabilize  his  environment  so  completely  that  all  inherited 
traits  originated  in  an  environment  would  suit  all  future 
environments.  But  since  life  is  continuous  change 
through  interaction,  and  since  all  man-made  environment 
changes  from  decade  to  decade,  the  adjustment  for  each 
generation  would  have  to  be  made  independent  of  the  prior 
one.  New  characters,  new  economic  conditions,  this  would 
be  the  recipe. 


THE  LIMITS  IN  CONSUMPTION          196 

But  it  appears  at  once  that  such  a  rapid  acquisition  of 
traits  would,  first,  make  man  much  less  stable  than  we 
know  him  to  be,  and  secondly,  would  give  the  reformer  no 
advantage,  since  good  traits  might  speedily  degenerate 
into  undesirable  ones  through  a  lack  of  proper  environ- 
ment control  during  one  single  generation.  The  breeder 
of  animals  and  plants  would  be  similarly  embarrassed  if 
Lamarckianism  were  so  construed,  and  eugenics,  of  course, 
could  never  hope  to  evolve  a  right  mankind,  because  many 
uncontrollable  environmental  influences  would  botch  his 
selections  and  cultures. 

So  it  can  only  be  a  question  as  to  what  the  environ- 
ment accomplishes  in  the  long  run,  say  in  the  course  of 
millions  of  years.  This  view  of  Lamarckianism  seems 
the  only  logical  one  and  has  been  given  wide  recognition 
by  experts. 

§  3.  The  Biological  View  of  Environment A  bi- 
ologist of  note  has  defined  an  acquired  character  as  a 
"  structural  change  in  the  body  of  a  multicellular  organ- 
ism, involving  a  deviation  from  the  normal  and  induced 
during  the  individual  lifetime  by  a  change  in  environment 
or  in  function,  and  such  that  it  transcends  the  limits  of 
organic  elasticity  and  therefore  persists  after  the  factors 
inducing  it  have  ceased  to  operate."  In  other  words, 
the  proof  of  transmission  by  organic  descent  of  an  ac- 
quired trait  is  the  fact  that  it  continues  to  function  after 
the  factors  responsible  for  its  emergence  have  disappeared. 
If  the  son  acts  as  the  father  did,  because  of  traits  aroused 
by  the  father's  environment  which,  however,  does  not  act 
on  the  son,  then  the  particular  trait  is  inherited  and  the 
acquired  one  has  become  organic.  The  precise  problem 
of  biology  is:  Does  such  a  transmission  commonly  take 
place?  Is  the  effect  of  environment  upon  offspring 
i  Thompson,  J.  A.,  "Heredity,"  p.  173. 


194  THE  LIMITS  OF  SOCIALISM 

specific  or  general,  direct  through  the  germ-cell  or  indi- 
rect via  the  body-cell,  cumulative  or  non-cumulative  in 
the  sense  that  the  inherited  trait  is  not  intensified  without 
further  environmental  influences? 

Now,  the  facts  of  cytology  advise  us  against  the  ac- 
ceptance of  Lamarckianism.  The  view  "  that  the  germ- 
plasm  responds  directly  to  the  experiences  of  the  body 
has  no  substantial  evidence  in  its  support."  And  the 
writer  of  these  words  adds :  "  I  know  of  course  that  the 
whole  Lamarckian  school  rests  its  argument  on  the  as- 
sumption that  the  germ-plasm  responds  to  all  profound 
changes  in  the  soma ;  but  despite  the  very  large  literature 
that  has  grown  up  dealing  with  this  matter  proof  is  still 
lacking.  And  there  is  abundant  evidence  to  the  con- 
trary." 2 

Experiments  speak  in  favor  of,  rather  than  against, 
Weismann's  doctrine  of  non-inheritance.  The  impossi- 
bility of  knowing,  especially  as  regards  human  beings, 
whether  a  trait  is  really  congenital,  and  whether  certain 
environmental  data  are  essential  in  the  development  of  an 
inherited  trait  acquired  by  the  parent,  militates  indirectly 
against  Lamarckianism.  But  the  facts  first  gathered  by 
Mendel,  the  Austrian  amateur  biologist,  in  his  experi- 
ments with  the  edible  pea  have  enlarged  our  understanding 
of  the  functions  of  bi-sexual  reproduction  so  that  to- 
day, after  years  of  investigation,  agreement  seems  to  have 
been  reached  on  the  points  most  significant  for  social  sci- 
ence. 

The  seat  of  heredity  has  been  traced  to  minute,  ultra- 
microscopic  entities  imbedded  in  the  chromosomes  which 
in  turn  are  part  of  the  nucleus  of  every  germ  cell.  It  is 
held  that  such  unit  factors  must  exist  because  without 
them  the  results  of  hybridization  remain  inexplicable, 
2  Morgan,  Th.  H.,  "  Heredity  and  Sex,"  p.  17. 


THE  LIMITS  IN  CONSUMPTION  195 

while  with  them  nearly  the  whole  mystery  of  heredity,  sex 
determination  not  excepted,  appears  solved.  Three  pos- 
tulates, according  to  an  eminent  authority,  lie  back  of 
the  doctrine  of  unit-factors  which  determine  plant  and 
animal  traits,  including  those  of  the  specie  homo  sapiens. 
Namely  the  assumption  that  the  factors  are  constants,  that 
two  factors  for  each  trait  are  lodged  in  the  cell,  and  that 
these  factors  segregate,  or  remain  segregated  in  the  ma- 
turing germ-cell.  Grant  this,  as  the  facts  of  the  case  urge 
us  to,  and  the  riddle  of  inheritance  offers  no  insurmount- 
able difficulties.  As  Professor  Morgan  puts  it :  "  The 
validity  of  the  unit-factor  conception  rests  upon  the  fact 
that  whenever  (as  often  happens)  all  other  conditions, 
external  and  internal  that  modify  characters,  remain  con- 
stant, then  clear-cut  ratios  are  obtained  which  can  be  ex- 
plained only  as  due  to  segregation,  in  definite  ways,  of 
particular  hereditary  factors  that  perpetuate  themselves 
unchanged  from  generation  to  generation."  3 

The  "  factor  "  in  the  chromosome  therefore  is  the  fash- 
ioner of  human  traits  and  in  a  sense,  of  history.  Human 
traits  are  built  out  of  them,  and  each  factor  affects  others 
while  it  in  turn  may  be  affected  from  several  sides.  "  A 
single  factor  may  have  several  effects,  and  a  single  char- 
acter may  depend  on  many  factors — ."  4  But  "  the  real 
unit  in  heredity  is  the  factor,  while  the  character  is  the 
product  of  a  number  of  genetic  factors  and  of  environ- 
mental conditions."  5  Which  is  to  say,  what  practically 
all  geneticists  admit,  that  the  influence  of  the  environ- 
ment is  real,  though  indeterminate  and  indirect.  To 
quote  once  more  from  Professor  Morgan :  "  There  is  a 
small  amount  of  evidence,  very  incomplete  and  insufficient 

s  Morgan,  Th.  H.,  "  The  Mechanism  of  Mendelian  Heredity,"  p.  47. 
*  Ibidem,  p.  210. 
s  Ibidem. 


196  THE  LIMITS  OF  , SOCIALISM 

at  present,  to  show  that  changes  in  the  environment  reach 
through  the  soma  and  modify  the  germinal  material." 6 
The  extreme  view,  therefore,  that  "  by  the  shuffle  and  deal 
of  the  hereditary  factors  in  the  formation  of  two  of  these 
cells  in  fertilization  our  hereditary  natures  were  forever 
sealed  — "  7  should  give  way  to  more  moderate  notions  of 
a  primary  influence  working  hand  in  hand  with  a  sec- 
ondary from  outside. 

The  fundamental  fact  is  the  interaction  of  the  de- 
terminers in  the  chromosomes.  Each  factor  will  bear  on 
the  other.  "  An  overstatement  to  the  effect  that  each  fac- 
tor may  affect  the  entire  body  is  less  likely  to  do  harm 
than  to  state  that  each  factor  affects  only  a  particular 
character."  8  But  in  addition  we  have  the  circuitous 
route  of  outside  forces  in  reaching  the  germ-cell.  Human 
nature  is  affected  from  the  outside,  by  post-natal  experi- 
ences, so  that  the  offspring  will  manifest  the  result;  but 
the  effects  are  general.  No  ratio  between  experience  and 
variation  in  particular  traits  can  be  established.  "  The 
effect  is  general  rather  than  specific,  and  the  result  as 
seen  in  the  offspring  has  no  discoverable  correlation  with 
any  particular  part  or  structure  of  the  parental  soma."  9 

Furthermore,  the  number  of  possible  combinations  by 
these  factors  is  so  immense  that,  if  their  shuffling  and 
permutations  fashion  the  characters  recognized  by  man, 
it  is  well  possible  to  obtain  countless  shades  and  varia- 
tions, even  supposing  the  environment  had  no  force  what- 
soever. The  chief  result  of  bisexual  reproduction  is  a 

«  Morgan,  Th.  H.,  "  Heredity  and  Sex,"  p.  18. 

7Conklin,  E.  G.,  "Heredity  and  Environment,"  p.  463.     (I.  Edit.) 

s  Morgan.  Th.  H.,  "  Critique  of  the  Theory  of  Evolution,"  p.  72. 

»  Guyer,  M.  F.,  "  Being  Wellborn,"  p.  135.  Similarly  Thorndike, 
E.  L.,  "Educational  Psychology,"  Volume  III,  p.  310.  But  for  a 
leading  authority  against  the  Weismannian  view  see  Cope,  E.  D., 
"Primary  Factors  of  Organic  Evolution,"  especially  pp.  392-443. 


THE  LIMITS  IN  CONSUMPTION          197 

much  greater  diversification  of  traits  than  a  sexual  life 
permitted.  But  it  also  brings  about  the  ratios  first  ob- 
served by  Mendel,  and  other  ratios  which,  though  orig- 
inally interpreted  as  exceptions  to  the  rule,  soon  were 
explained  as  results  of  combinations  unsuspected  by 
Mendel.  In  the  long  run,  on  the  principle  of  chance  vari- 
ations, regularity  in  appearance  of  traits  was  inevitable. 
Dependent  upon  the  number  of  factors,  and  upon  their 
bundling  in  the  formation  of  unit-characters,  parents 
would  bequeath  traits  to  their  offspring  in  fixed  propor- 
tion. Per  thousand  or  million  of  inhabitants  such  and 
such  traits  would  recur  with  astonishing  regularity.  In- 
deed, the  logical  bearing  of  the  laws  of  probability  and 
error  upon  genetics  has  been  acknowledged  with  en- 
thusiasm in  support  of  eugenic  programs.  In  the  words 
of  one  geneticist :  "  Nothing  is  clearer  than  that  the 
inevitable  consequences  of  bisexual  reproduction  and  of 
the  manner  of  growth  by  the  halving  of  the  cell-con- 
tents is  to  insure  that  character-combinations,  effected  in 
this  manner,  are  brought  together  in  definite  mathematical 
proportions  not  far  from  those  expressed  in  the  expan- 
sion of  the  binomial.  This  is  the  real  foundation  of 
Mendel's  law  for  characters  that  do  not  blend,  and  it  also 
expresses  the  relative  proportions  of  characters  that  do 
blend."  10 

The  latter  is  the  most  important  point  for  socialism. 
It  does  not  matter  whether  a  human  trait  is  deemed  a 
unit  in  the  cytological  sense  or  not.  All  traits  recur  on 
the  principle  of  average  and  frequency  of  errors  as 
mathematicians  understand  the  terms.  "  The  differences 
in  hereditary  endowment  —  of  strength  or  intelligence, 
of  stature  or  longevity,  of  fertility  or  social  disposition, 
have  a  certain  regularity  of  distribution,  so  far  as  we  can 

10  Davenport,  E.,  "  Principles  of  Breeding,"  p.  546. 


198  THE  LIMITS  OF  SOCIALISM 

measure  them  at  all.  They  conform  to  what  is  called  the 
Normal  Law  of  Frequency  — ."  n  In  this  sense,  there- 
fore, human  nature  is  constant.  Our  experiences  in 
everyday  life  are  confirmed.  Historians  hear  their  own 
verdict  repeated,  and  reformers  know  what  not  to  expect 
from  reforms. 

It  is  not  likely  that  the  abolition  of  private  property 
will  affect  posterity  through  the  living  generation,  ex- 
cept by  way  of  social  heredity.  Organic  heredity  will 
play  no  part  in  the  change.  Genius  will  be  more  plenti- 
ful perhaps,  and  certainly  types  of  subnormality  ought 
to  become  rarer,  but  we  can  no  more  measure  a  crop  of 
genius  by  economic  income  than  we  can  improve  the 
human  race  unerringly  by  the  application  of  genetics  to 
society. 

In  the  case  of  genius  we  have  still  to  acknowledge  that 
the  occupation  of  parents  and  grandparents  seems  to 
have  exercised  no  measurable  influence  upon  the  direction 
genius  took,  and  that  the  characteristics  of  one  eco- 
nomic period  have  never  given  us  a  clue  as  to  the  sorts 
of  genius  born  in  the  next  epoch.  We  only  know  that 
superior  civilizations  have  excelled  in  the  production  of 
genius,  and  that  these  titans  of  intellect  themselves  ad- 
vanced the  thought  of  their  age.  We  do  not  know 
whether  genius  is  a  mutation  in  the  biological  sense, 
or  whether  it  should  be  classed  as  a  normal  fluctuation, 
non-hereditary  and  insignificant  for  evolutionary  pur- 
poses. 

Fluctuations  have  been  defined  as  continuous  variations 
"  which  are  graded,  the  extremes  being  connected  by  a 
complete  series  of  intermediate  conditions."  12  A  Muta- 
tion according  to  one  authority,  is  "  a  discontinuous 

11  Thompson,  J.  A.,  "Heredity"  (2nd  Edit.),  p.  523. 

12  Castle,  W.  E.,  "  Genetics  and  Eugenics,"  p.  56. 


THE  LIMITS  IN  CONSUMPTION  199 

germinal  change  arising  from  a  physical  or  chemical  alter- 
ation in  the  structure  of  the  organism,  or  of  one  or  both 
of  the  germ-cells  which  produce  a  new  individual,  or  from 
such  a  change  arising  in  certain  cells  elsewhere  in  the  life- 
cycle  of  the  organism,  this  change  being  capable  of  com- 
plete inheritance  at  least  in  some  of  the  offspring, 
although  reversion  may  occur  in  others."  13  What  is 
known  of  genius  might  be  classed  with  either  definition, 
but  it  does  not  matter  much  because  mental  traits  are  not 
known  to  be  subject  to  Mendelian  laws  of  heredity.  The 
cultivation  of  genius,  that  is  of  types  of  men  most  in- 
fluential in  the  development  of  races,  cannot  as  yet  be 
considered  a  subject  for  science. 

The  scope  and  usefulness  of  eugenics  is,  in  fact,  seri- 
ously limited  by  several  gaps  in  our  knowledge  of  the  or- 
ganism. We  do  not  know  exactly  what  constitutes  a 
human  unit  character,  though  it  is  agreed  that  a  single 
mental  trait  is  compounded  of  probably  many  factors  in 
the  germ-cell.14  It  is  of  first  importance  to  ascertain  the 
correlation  of  good  characters,  or  of  the  good  with  the 
bad,  so  the  latter  may  be  culled  out  if  possible;  but  the 
data  for  such  procedure  are  altogether  lacking.  It  is 
admitted  that  human  beings,  unlike  lower  forms  of  life, 
continue  to  grow  mentally  long  after  physical  growth  has 
stopped.  In  many  cases  mentality  develops  most  rapidly 
after  the  mating  age  has  normally  passed,  say  from  the 
thirtieth  year  on.  It  would  therefore  be  a  mistake  to 
judge  the  fitness  or  excellence  of  a  mating  couple  purely 
by  its  qualifications  at  the  date  of  marriage.  And  again, 
the  means  of  detecting  inherent  faults  and  of  regulating 
marriage  are  exceedingly  uncertain.  It  will  always  be 

is  Gates,  R.  R.,  "  Tne  Mutation  Factor  in  Evolution." 
i*  See  e.g.,  Thorndike,  E.  L.,  "Educational  Psychology,"  Volume 
III,  p.  268. 


200  THE  LIMITS  OF  SOCIALISM 

difficult  to  accomplish  in  the  breeding  of  humans  what  the 
animal  breeder  has  already  achieved. 

And  finally  there  will  be  much  disputing  as  to  what 
the  desired  type  of  manhood  or  womanhood  is.  What 
kind  of  man  is  wanted?  This  is  the  paramount  question 
which  the  combined  training  of  natural  and  social 
scientists  may  not  enable  us  to  answer.  There  exist  no 
records  by  which  we  may  be  guided.  Each  group  of  ex- 
perts will  describe  the  ideal  man,  and  in  many  points  the 
agreement  of  groups  will  be  ample. 15j  But  on  others  no 
unanimity  will  be  reached.  History  and  sociology  only 
teach  the  predominance  of  several  types  of  men,  and  the 
apparent  necessity  of  a  large  number  of  types  for  the  at- 
tainment of  unusual  things.  Civilization  needs  many 
kinds  of  people.  Specialization  should  not  be  coun- 
selled merely  as  a  precept  in  education,  but  if  it  were 
possible  the  eugenist  should  seek  to  produce  strains  highly 
specialized,  so  our  learning  period  may  be  shortened  or 
natural  aptitude  bring  greater  results. 

A  change  of  the  proportion  in  which  different  types  of 
men  now  are  born  must  plainly  have  a  momentous  effect 
upon  future  history.  But  the  eugenist  seems  as  help- 
less in  this  matter  as  the  socialist.  Both  must  acknowl- 
edge their  limitations.  Genetics  has  not  yet  furnished 
us  a  clue  to  the  elimination  of  all  the  unfit,  and  socialism 
cannot  hope  to  root  out  all  evils  in  social  life  by  rooting 
out  private  capital.  Socialists,  however,  have  the  ad- 
vantage in  that  the  direct  and  indirect  influence  of  the  en- 
vironment upon  the  living  organism  is  known  and  often 
measurable.  Socialists  will  always  have  a  large  field  for 

is  For  leading  classifications  of  People  according  to  dominant 
traits  see,  for  instance,  Ratzenhofer,  G.,  "  Soziologische  Erkenntnis"; 
Patten,  S.  N.,  "Development  of  English  Thought";  and  Giddings, 
F.  H.,  "  Inductive  Sociology." 


THE  LIMITS  IN  CONSUMPTION          201 

action  regardless  of  what  eugenics  may  claim  for  itself. 
The  more  fickle  human  nature,  the  more  important  a 
right  economic  environment  for  each  living  generation. 
The  more  constant  human  nature,  the  more  pressing  mani- 
festly our  duty  to  adapt  man  to  his  environment  and  to 
redirect  his  inclinations  as  the  facts  of  social  science  ad- 
vise. The  economist,  like  the  socialist,  cannot  lose  by 
any  answer  finally  given  to  the  Lamarckian  query,  but 
in  the  light  of  current  investigations  the  necessity  of 
sound  economy  and  of  wise  government  seems  more  obvious 
than  ever  before.  The  variables  lie  outside  of  man  viewed 
socially,  for  while  variation  is  fully  as  significant  as 
heredity,  the  law  of  probability  applied  to  the  workings 
of  the  hereditary  mechanism  assures  us  of  a  fairly  con- 
stant distribution  of  departures  from  type.  Some  traits 
are  shared  by  all  men.  The  instincts  may  be  classed 
among  them,  though  their  degree  of  strength  varies. 
About  the  more  universal  we  group  the  less  universal 
human  traits.  Special  deviations  occur,  but  not  fre- 
quently. The  more  marked  a  deviation  the  rarer  it  is. 
Thus  the  core  of  human  nature  seems  to  remain  the  same. 
Doubtless  it  only  seems  to,  for  everything  changes,  the 
fundamental  traits  of  man  not  excluded.  But  the  change 
is  so  gradual  that  we  do  not  notice  it.  It  is  as  with  the 
sun  which  is  said  to  move  toward  a  far  out  point  in  the 
cosmos.  We  picture  it  in  motion,  and  yet  make  it  a  con- 
stant because  of  the  revolution  and  rotation  of  the  earth, 
which  is  so  much  more  in  evidence.  We  ignore  the  move- 
ment of  the  central  body  and  heed  only  those  of  our  own 
planet.  Human  nature  may  be  called  a  constant  for 
much  the  same  reason. 

§  4.  Income  and   Efficiency —  What  we   can  do  with 
men  by  raising  their  income  is  a  problem  each  generation 


202  THE  LIMITS  OF  SOCIALISM 

must  solve  anew,16  but  the  uncontrollable  recurrence  of 
types  manifestly  sets  bounds  to  our  reforms.  We  should 
not  expect  to  double  efficiency  because  we  double  library 
facilities,  and  we  should  not  guarantee  people  happiness 
because  we  have  added  to  their  creature  comforts.  The 
powers  of  response  to  economic  stimuli  such  as  goods  em- 
body cannot  be  arbitrarily  developed,  though  something 
may  be  done  with  them.  The  circumstance  thfct  all  ex- 
periences are  interrelations  should  convince  us  of  the 
fatuity  of  adjustments  in  one  quarter  only.  It  takes 
more  than  one  element  in  education  to  arouse  our  dor- 
mant faculties,  and  it  takes  many  combinations  of  per- 
sonal traits  and  objective  facts  to  make  man  contented. 
Perhaps  we  shall  succeed  in  mastering  some  of  them,  but 
not  all. 

In  so  far  as  the  end  of  consumption  is  the  development 
of  innate  powers  for  actI6rT7"a  sufficient  economic  income 
is  of  course  a  prerequisite.  But  since  only  that  is  part 
of  our  world  which  we  react  to.  consciously  or  uncon- 
sciously, much  income  is  sure  to  be  wasted.  It  will  bring 
no  psychic  returns.  It  may  ufldeT  special  direction  b'e 
used  to  stimulate  reactions  and  intensify  them,  but  in  it- 
self it  may  remain  inert.  Either  the  initiative  is  inborn, 
or  it  must  come  from  outside  through  the  facts  of  socia- 
tion  in  general  and  of  education  in  particular. 

Nothing  is  more  familiar  than  the  sight  of  people  who 
command  wealth,  but  stand  helpless  not  knowing  what  to 
do  with  it.  People  are  surrounded  with  art  treasures, 
but  derive  no  benefit  from  them.  Opportunity  beckons 
them  on  all  sides,  but  they  will  not  be  inspired.  Exten- 

i«The  effect  of  social  environment  on  genius  and  achievement  is 
stressed  notably  by  Ward,  L.  F.,  in  his  "Pure  Sociology,"  and  in 
his  later  "Applied  Sociology,"  where  Chapter  9  deals  with  an 
eminent  French  study  on  this  subject. 


THE  LIMITS  IN  CONSUMPTION  203 

sive  travels  yield  no  lasting  productive  impressions. 
They  see  but  do  not  understand.  They  listen,  but  do  not 
heed.  They  associate  with  the  best,  but  fail  to  assimilate 
the  best.  Suggestions  come  to  them  from  all  sides,  but 
nothing  valuable  is  constructed  out  of  them. 

Many  scientists  worked  without  funds  or  apparatus  and 
laboratory,  yet  they  opened  up  new  and  large  fields  of 
investigatfon  the  results  of  which  we  call  modern  civiliza- 
tion. It  is  not  the  number  of  facts  mastered  by  Aristotle 
that  put  him  in  a  class  by  himself,  for  many  a  youth  to- 
day has  more  of  them  at  his  fingers'  ends  than  the  in- 
ventor of  the  syllogism  had  ever  heard  of.  Rather  it  was  | 
what  he  put  into  the  few  facts  he  knew,  the  meaning  he 
gave  them  by  properly  correlating  them,  and  the  rules  of 
conduct  he  deduced  from  them  in  his  search  for  a  richer 
life.  A  Newton  could  invent  calculus  to  solve  self-imposed 
problems  of  physics  and  astronomy.  A  Galileo  or 
Lavoisier  or  Faraday  or  Helmholz  could  found  a  new 
science  without  the  aid  of  expensive  instruments. 

We  shall  always  have  with  us  the  thinkers  and  the 
tinkers,  those  who  blaze  a  trail  and  lead  us  to  new  realms 
of  wonder,  and  those  who  patch  up  matters  for  a  while, 
but  are  useful  in  no  finer  sense.  We  shall  probably  al- 
ways have  men  of  renown  and  the  mediocre  who  shine  by 
reflected  light.  Education  will  help  the  slow-witted  but 
it  cannot  lift  them  far  above  their  level.  Curricula  do  not 
make  scholars,  nor  can  tutors  make  wise  men  out  of  fools. 

The  progress  of  science  and  of  educational  facilities 
during  the  last  hundred  years  testifies  eloquently  to  the 
worth  of  great  men.  In  some  measure,  too,  it  has  bene- 
fited the  man  of  average  ability,  though  he  has  not  been 
given  the  chance  that  he  should  have.  It  is  not  then  a 
point  of  questioning  the  importance  of  education.  On  the 
contrary,  leaders  in  the  future  will  wish  to  vulgarize  it 


204  THE  LIMITS  OF  SOCIALISM 

more  than  ever,  and  do  it  in  a  thoroughly  democratic 
manner.  Even  if  much  time  is  wasted  in  culling  the 
talented  from  the  incompetent,  even  if  the  best  pupils 
should  suffer  from  the  partialities  shown  to  the  dunces,  it 
is  better  that  we  raise  the  general  level  of  intelligence  an 
inch  than  that  of  a  chosen  few  a  foot. 

But  on  the  other  hand  it  must  be  admitted  that  school- 
ing has  limited  functions.  The  recent  multiplication  of 
institutions  of  learning,  of  art  works  and  museums,  of 
public  libraries  and  of  free  lectures  for  the  delectation  of 
curious  folk  has  not  brought  the  results  that  might  have 
been  offhand  expected.  The  response  often  has  been  half- 
hearted and  insincere.  The  fruits  have  not  repaid  for  the 
labors  of  cultivation.  The  instructor  has  not  found  his 
audience  react  in  a  scientific  spirit.  Education  has  even 
spoiled  some  for  lines  of  work  they  were  naturally  fitted 
for,  while  many  who  went  without  a  long  drilling  in  techni- 
cal subjects  have  nonetheless  emerged  out  of  the  struggle 
for  life  with  a  creditable  showing,  both  in  earning  money 
and  in  contributing  toward  the  world's  welfare.  At  all 
times,  it  may  be  said,  education  has  played  a  less  vital 
part  in  the  development  of  exceptional  personalities  than 
the  friends  of  erudition  have  liked  to  confess. 

Printing  has  practically  done  away  with  illiteracy,  but 
not  with  paucity  of  ideas.  Books  nowadays  are  cheap, 
but  thinking  is  still  rare.  People  have  garnered  rich 
stores  of  fact,  but  failed  to  build  with  them.  They  have 
remembered,  but  not  applied  knowledge  intelligently.  In- 
telligence comes  slowly.  Intelligence  is  the  power  of  con- 
quering unforeseen  obstacles  in  theory  or  practice.  In- 
telligence is  the  chief  weapon  of  modern  times  for  defense 
and  offense  in  production.  The  number  of  those  who  have 
learned  to  imitate  or  to  understand  what  was  taught  at 
school  grows  steadily,  but  the  ability  to  formulate  new 


THE  LIMITS  IN  CONSUMPTION          205 

problems    calling    for    new    solutions    is    always    rare. 

Yet,  because  education  is  so  important  and  leisure  a 
prerequisite  to  it,  socialists  rightly  insist  upon  an  exten- 
sion of  both.  The  question  thus  arises:  How  shall  the 
additional  amount  of  spare  time  be  used?  For  rest  and 
entertainment,  yes.  But  also  for  development  of  the 
self  and  of  a  social  sense.  Increasingly  the  last  genera- 
tion of  workers  has  had  spare  time  for  all  of  these  pur- 
poses, but  past  experience  does  not  permit  one  to  hope 
that  the  granting  in  itself  of  leisure  will  suffice.  The 
cheapening  of  consumption  goods  has  sometimes  cheap- 
ened also  our  appreciations  of  art  and  science.  And 
similarly  additional  leisure  may  be  abused  unless  socialism 
provides  the  right  sort  of  guidance.  One  is  impressed 
with  the  limitations  of  possession,  that  is  of  income,  when 
one  watches  the  way  in  which  people  utilize  it.  To  listen 
to  popular  music  played  on  the  automatic  piano,  for  in- 
stance, or  to  the  graphophone  is  to  lose  faith  in  the  power 
of  riches.  Taste  has  been  little  improved,  but  shallow- 
ness  is  daily  encouraged.  The  magazines  still  pander  to 
frivolous  inclinations  and  thoughtless  readers.  The 
"  best  seller  "  is  proverbially  an  inferior  piece  of  litera- 
ture, and  no  doubt  will  remain  so.  The  masses  do  not  fre- 
quent our  museums,  though  they  have  plenty  of  time  for 
trivialities.  The  stage  does  not  appeal  unless  music  is 
reduced  to  oddities  of  rhythm  and  the  play  made  a  farce 
or  a  melodrama.  Everywhere  we  see  tricks  of  trade 
prosper,  but  true  art  perish. 

Up  to  the  present  this  may  have  been  an  inevitable 
result  of  our  educational  system,  or  of  the  stigma  put 
upon  serious  endeavor  in  pastimes.  But  if  socialism  is 
to  elevate  social  welfare  to  its  noblest  heights  and  give 
maximum  health  and  intellectual  vigor  to  all,  it  will  have 
to  revise  the  leisure  schedule  also.  Much  teaching  in  this 


206  THE  LIMITS  OF  SOCIALISM 

direction  will  be  needed;  much  patience  and  sacrifice  on 
the  part  of  the  most  highly  gifted.  Formal  schooling  will 
help,  but  a  public  supervision  of  amusements,  a  fostering 
of  a  community  spirit  for  mutual  enjoyment  and  aid  will 
do  even  more.  The  socializing  functions  of  play  and  art 
have  not  yet  been  fully  recognized.  The  charm  of  en- 
joying goods  in  common  has  not  been  sufficiently  revealed 
to  us  because  the  private  property  concept  has  made 
us  suspicious  where  we  should  have  been  open-minded. 
Leisure  may  invigorate  body  and  mind,  or  it  may  cloy  our 
senses  and  kill  ambition.  The  habits  of  the  wealthy 
should  be  a  warning  in  this  respect.  They,  too,  have 
made  less  use  of  their  opportunities  than  seems  right. 
Even  among  them  time  drags  and  ennui  is  a  malady.  For 
lack  of  natural  capacities  income  and  leisure  have  re- 
mained sterile.  It  has  brought  no  fruit  because  the  inner 
means  of  response  were  not  developed. 

§  5.  Income  and  Happiness. —  What  is  true  of  the 
limits  of  consumption  in  developing  efficiency  and  a  proper 
use  of  consumables  is  also  true  of  the  relation  between 
pleasure  and  riches.  Socialism  will  not  add  greatly  to 
happiness,  though  by  objective  tests  our  level  of  living 
will  be  higher.  But  as  remarked  before,  the  objective 
tests  may  disagree  with  the  subjective.  It  is  time  that 
people  dissociate  pleasure  from  prosperity  and  judge 
each  by  its  own  indications. 

Pleasure  as  the  opposite  of  pain  has  of  course  been 
eulogized  ever  since  men  have  breathed  and  pondered  on 
final  values.  The  cynics  of  old  thought  nothing  worth 
while.  They  belonged  to  an  age  in  which  the  old  faith 
was  crumbling  and  the  new  knowledge  was  not  able  to  fill 
an  emotional  void.  When  belief  in  the  gods  goes  and 
doubt  permeates  all  fields  of  inquiry  a  resort  to  cynicism 
is  natural.  Energy  must  have  an  outlet  somewhere.  But 


THE  LIMITS  IN  CONSUMPTION  207 

it  might  seem  strange  that  even  in  modern  days 
philosophers  have  returned  to  the  calculus  of  pleasure  and 
pain,  were  it  not  that  they  kept  in  mind  the  need  of  uni- 
versalizing pleasure,  instead  of  centering  it  in  the  in- 
dividual, and  that  they  reasoned  from  premises  no  longer 
accepted  by  science.  They  hoped  to  make  all  states  of 
feeling  quantitatively  measurable  so  that  avoidance  of 
pain  became  the  equivalent  of  pleasure.  They  sought  to 
please  the  largest  possible  number,  and  aimed  at  better- 
ment for  that  reason,  seeing  that  the  masses  then  had 
many  duties  and  few  privileges. 

Hedonism,  however,  has  gone  the  way  of  other  dogmas. 
It  rendered  the  eighteenth  century  a  service,  since  it  pre- 
pared the  way  for  Enlightenment  and  the  French  Revolu- 
tion, but  it  no  longer  meets  our  requirements  because  we 
know  that  not  all  feelings  can  be  classified  and  compared 
like  so  many  yards  of  ribbon.  The  weakness  of  every 
subjective  norm  is  its  elusiveness.  We  cannot  tell  when 
people  are  happy.  Or  if  we  do  dare  to,  we  may  be  as- 
sured quite  to  the  contrary.  States  of  feeling  cannot 
satisfy  the  student  of  welfare  unless  they  have  an  ob- 
jective correlate,  the  ratio  of  the  two  being  more  or  less 
definite.  But  such  is  not  the  case. 

There  are  pains  akin  to  pleasure,  and  states  of  happi- 
ness that  bring  an  undercurrent  of  chagrin.  Just  as  sick 
men  have  been  known  to  work  creatively  and  enjoy  life 
though  stricken  with  agonizing  diseases,  so  trying  ex- 
ternal conditions  have  at  times  been  forgotten  over  the 
pleasures  of  work  or  of  buoyant  energy.  Brief  pleasures 
have  brought  lasting  misery  to  some,  and  painful  moments 
have  been  deliberately  courted  because  they  promised  en- 
joyment thereafter.  The  miser  rejoices  in  the  misery  of 
his  greed,  and  the  prodigal  bemoans  his  fate  while  squand- 
ering all. 


208  THE  LIMITS  OF  SOCIALISM 

Pleasures  cannot  be  measured  by  income  alone,  and  if 
they  could  be  it  would  not  mean  anything  for  science,  for 
socialism,  of  for  social  welfare.  Happiness  is  not  always 
the  same  as  pleasure,  if  by  the  latter  we  mean  sensa- 
tions externally  stimulated.  But  for  the  most  part  those 
who  are  pleased  are  happy.  It  is  difficult  to  tell  one  from 
the  other,  unless  we  arbitrarily  consider  one  a  selfish  in- 
dulgence, and  the  second  an  emotion  socially  sanctioned. 
But  such  distinctions  are  of  little  import. 

The  main  fact  is  our  inability  to  create  happy  states 
of  being  at  will.  We  can  promote  happiness  only  by  pop- 
ularizing health,  wealth,  and  efficiency.  In  the  long  run 
health  means  enjoyment.  On  an  average  the  well-fed  and 
properly  clothed  suffer  less  pain  than  the  paupers  who 
have  nothing.  As  a  general  rule  the  most  intelligent  and 
efficient  have  sources  of  happiness  not  possessed  by  the 
helpless. 

Yet,  whether  education  and  intelligence  offer  compen- 
sations in  the  way  of  happiness  for  the  pleasures  common 
among  the  ignorant  is  doubtful.  Perhaps  it  would  not 
be  too  much  to  say  that  happiness  is  essentially  an  attri- 
bute of  youth.  When  we  are  young  and  strong,  when 
energy  is  at  a  maximum  and  the  power  of  resisting  hard- 
ships great,  then  we  enjoy  life.  Happiness  is  for  those 
in  the  early  stages  of  life  when  the  blood  flows  swift  in 
our  veins  and  the  metabolic  process  quickly  replaces  waste 
tissue  and  poisons.  Youth  means  ignorance  and  in- 
nocence, and  both  are  sources  of  contentment.  Happi- 
ness should  not  be  felt,  to  be  real.  When  we  begin  to  rea- 
son about  it  we  probably  have  lost  it.  In  this  sense 
happiness  is  youth  remembered  by  old  age. 

In  later  life  however  many  sources  of  happiness  arise 
that  childhood  is  a  stranger  to.  The  compensations  for 
toil  and  duress,  for  doubt  and  worries,  come  in  the  shape 


THE  LIMITS  IN  CONSUMPTION          209 

of  creative  work  or  of  success  in  conquering  a  self-im- 
posed difficulty.  Self-measured  success  is  the  acme  of 
happiness.  We  learn  to  master  ourselves  and  to  help 
others.  There  is  leadership  and  a  happy  home,  or  friend- 
ship and  convivialities  intellectual  or  otherwise.  There  is 
relaxation  and  a  venting  of  energy  at  games.  We  have 
the  applause  of  the  multitude,  and  affection  for  and  from 
others.  All  these  are  types  of  contentment  constituting 
in  the  aggregate  a  happy  state  of  life.  If  the  Jefferson- 
ian  phrase  ever  meant  anything  it  must  have  meant  such 
things,  although  the  thought  of  rating  public  welfare  by 
such  personal  rights  and  reactions  spoiled  much  of  the 
effect  which  this  creed  had  upon  a  later  generation. 

But  if  happiness  may  come  so  independent  of  income  it 
clearly  may  vanish  also  without  regard  to  income.  There 
are  occasions  for  unhappiness  that  no  one  system  of  pro- 
duction or  consumption  will  remove.  Most  of  our 
troubles,  indeed,  come  from  within.  At  any  rate  we  may 
call  the  environment,  in  this  connection,  a  constant  and 
declare  our  feelings  variable  according  to  our  inborn  pre- 
dispositions. We  are  annoyed  by  trifles  in  personal  re- 
lations. We  chafe  at  restraints  and  slights  that  even  the 
equalization  of  wealth  and  ability  cannot  rid  us  of. 
Human  traits  are  such  as  to  make  a  certain  amount  of 
friction  unavoidable.  We  are  bound  to  struggle  and 
suffer  in  a  measure.  Comparisons  will  always  be  odious, 
and  failure  to  accomplish  what  we  set  out  to  do  will  irri- 
tate us  to  the  quick.  Envy  and  suspicion,  peevishness  and 
false  pride  embitter  the  life  of  many.  There  is  no  cure 
except  through  gradual  adjustment  with  the  aid  of  edu- 
cation ;  or  perhaps  still  more  so,  through  breeding  accord- 
ing to  temperament.  Eugenics  might  in  this  regard  ac- 
complish what  economics  and  socialism  must  give  up  as  a 
hopeless  task. 


210  THE  LIMITS  OF  SOCIALISM 

Socialism,  in  fine,  can  help  the  masses  greatly  by 
economic  control  since  leisure,  education,  health  and 
efficiency  go  inseparably  together.  But  it  would  be  folly 
to  expect  a  millennium  of  happiness  for  people  simply 
because  we  have  bettered  the  objective  facts  of  living. 
The  aim  of  the  reformer  cannot  be  happiness;  it  must  be 
achievement  and  welfare  socially  measured.  But  that  is 
far  from  ensuring  the  average  man  greater  bliss  con- 
sciously felt. 


CHAPTER  IX 
THE  LIMITS  IN  GOVERNMENT 

§  i.  The  Relation  of  Empiricism  to  Political  Democ- 
racy.—  The  Communist  Manifesto  of  1848  concluded  with 
the  memorable  words :  "  Workingmen  of  all  the  world, 
unite."  It  was  the  final  and  most  stirring  appeal  of  the 
founders  of  socialism  to  the  masses  whose  slavery  they 
hoped  to  end  by  a  revolution.  The  nation  was  not 
recognized  by  Marx  as  the  indispensable  unit  of  social 
life.  The  fact  of  the  brotherhood  of  men  everywhere  was 
to  displace  it  and  make  nationalism  unnecessary. 

Yet  it  was  significant  that  the  fiery  words  of  Engels 
and  Marx  were  addressed  to  the  international  proletariat 
for  a  battle  against  capitalism.  The  call  was  not  for 
peace;  it  was  for  war  on  the  exploiters  who  must  be 
subjugated  first  before  the  brotherhood  of  men  could  be- 
come real.  Socialism,  thus,  introduced  the  idea  of  cos- 
mopolitanism with  a  reminder  of  class  struggle,  and  it  ex- 
pected to  establish  democracy  only  by  throwing  out  of 
the  saddle  the  proud  managers  of  big  business.  This 
was  a  gain  and  a  loss  both.  It  marked  an  advance  over 
old  ideals  because  the  test  of  democracy  was  sought  in 
something  more  important  than  the  right  to  cast  a 
ballot,  and  it  seemed  a  step  backward  because  a  supposed 
iron  law  of  wages  was  to  be  abrogated  by  iron  force. 
So  the  adherents  of  socialism  long  interpreted  the  Mani- 
festo, and  with  this  thought  of  a  revolution  quickening 
the  pace  of  evolution  they  went  to  work. 

Socialism  is  a  clarion  call  to  action  for  liberating  the 

211 


THE  LIMITS  OF  SOCIALISM 

masses.  The  proof  of  true  socialism  is  the  fraternizing 
of  all  men  regardless  of  race  or  color  or  nationality,  and 
the  extension  of  the  principle  of  equal  rights  to  all 
spheres  of  social  activity.  Socialism  is  nothing  if  not 
economic  democracy  internationalized. 

What  can  be  said  for  democracy  and  internationalism? 

The  thought  of  democracy  doubtless  is  as  old  as 
history,  though  the  word  was  not  coined  till  the  Greeks 
learned  to  reflect  on  the  problems  of  city  government. 
Aristotle  then  made  his  distinctions  of  types  of  govern- 
ment and  gave  reasons  for  preferring  a  moderate  form  of 
democracy  in  which  the  people  had  a  nominal  share,  but 
which  was  really  in  the  hands  of  a  selected  few,  to 
monarchy.  Democracy  as  the  rule  of  the  people  was  thus 
early  construed  to  mean  a  government  by  the  few  for  the 
many. 

It  was  important,  however,  that  the  Greeks  were  the 
first  to  trace  the  origin  of  society,  for  in  this  way  they 
hit  upon  the  ideal  of  a  state  of  nature  in  which  all  men 
had  been  free  and  equal.  The  sovereign,  they  averred, 
was  in  those  primordial  days  either  the  father  of  the 
family,  or  the  strongest,  most  assertive  and  capable  at  a 
crisis.  Sovereignty  therefore  came  to  signify  absolute 
power,  and  this  has  been  its  main  attribute  ever  since. 
He  is  sovereign  who  has  no  superior,  who  exercises  his 
power  as  he  pleases,  and  who  rules  by  his  own  initiative, 
whatever  assent  expressed  or  tacit  may  come  from  the 
governed. 

The  ingenious  notion  of  a  compact  whereby  the  free- 
men living  in  a  state  of  nature,  protected  solely  by  their 
personal  strength  and  cunning,  relinquished  their  liberties 
for  the  sake  of  ending  interminable  feuds,  added  ma- 
terially to  the  reputation  of  Greek  philosophy,  besides  ex- 
ercising a  lasting  influence  over  the  development  of  modern 


THE  LIMITS  IN  GOVERNMENT          213 

politics.  From  the  seventeenth  to  the  latter  part  of  the 
eighteenth  century  nothing  seemed  so  self  evident  as  that 
people,  having  been  originally  endowed  by  their  creator 
with  certain  inalienable  rights,  could  have  given  them  up 
only  on  terms  suitable  to  themselves,  self -protection  and 
the  promotion  of  the  social  welfare  being  plainly  among 
the  aims  of  government.  It  followed  from  this  amplifica- 
tion of  an  ancient  doctrine  that  the  overthrow  of  the 
divine  right  theory  of  kings  was  a  duty  rather  than  an 
act  of  sedition. 

The  development  of  natural  science  strengthened  this 
view  of  the  situation.  The  founders  of  physics, 
astronomy,  and  biology  were  men  who  had  little  patience 
with  the  metaphysical  viewpoint.  Their  concern  was  the 
investigation  of  facts  and  the  establishment  of  laws  by 
the  experimental  methods.  Where  induction  was  out  of 
the  question,  the  time-honored  syllogism  did  its  work,  but 
it  was  understood  that  no  matter  how  philosophy  might 
proceed  it  would  start  with  certain  assumptions  that 
begged  the  ultimate  questions  professedly  answered.  In 
this  spirit  the  empiricists  before  long  became  materialists 
who  considered  the  world  a  huge  mechanism,  and  some- 
what in  harmony  with  this  realistic  attitude  they  also 
treated  problems  in  social  life.  They  favored  the  utili- 
tarian notion  that  government  is  for  the  governed.  They 
found  in  the  theory  of  a  compact  between  people  and 
sovereign  nothing  very  objectionable.  They  were  with- 
out exception  opposed  to  crass  monarchism  and  took  for 
granted  the  limitations  that  gradually  were  placed  upon 
the  Crown. 

The  idealists  in  philosophy,  on  the  contrary,  stood  with 
the  exception  of  the  gentle  Spinoza  for  state-rights,  that 
is  to  say  for  the  supremacy  of  the  body  politic  whose  head 
wielded  unrestricted  powers.  Descartes,  Leibniz,  Wolff, 


214  THE  LIMITS  OF  SOCIALISM 

Kant  and  Hegel  all  belonged  to  this  class  of  thinkers 
whose  tracts  on  government  reflected  the  absolutistic 
spirit,  not  only  of  their  political  masters,  but  also  of  their 
own  metaphysical  doctrines.  The  difference  in  this  re- 
spect between  the  idealists  and  empiricists  has  not  been 
widely  noticed  or  frankly  admitted,  but  the  materials  for  a 
testing  can  be  easily  collected.  Broadly  speaking  one  may 
draw  the  line  of  demarcation  as  suggested:  The  one 
group  unfailingly  championed  constitutionalism  in  prac- 
tice no  less  than  in  theory,  the  other,  namely  the  meta- 
physicians, leaned  toward  political  absolutism,  even  if 
ostensibly  with  some  reservations  in  the  other  direction. 
But  needless  to  say,  the  advocates  of  popular  sovereignty 
had  the  better  of  it.  Rousseau's  notion  of  the  general  will 
of  the  people  won  out. 

It  carried  the  day  first  because  it  fell  in  logically  with 
the  general  trend  of  scientific  investigations,  and  secondly 
because  of  the  change  in  economic  conditions  that  is  some- 
times described  by  the  phrase  The  Industrial  Revolution. 
This  event  inevitably  favored  the  laboring  classes  in  that 
its  success  presupposed  certain  individual  economic  rights, 
whose  counterpart  was  the  principle  of  universal  suffrage 
and  of  legislation  in  accord  with  public  opinion.  Autoc- 
racy could  not  hold  itself  in  the  face  of  such  changes, 
though  as  against  this  it  must  be  confessed  that  democ- 
racy soon  received  a  setback  also. 

For  it  lay  in  the  nature  of  the  new  economic  situation 
that  the  propertied  classes  held  sway  over  the  masses. 
To  be  sure,  the  qualifications  for  voting  or  holding  a  seat 
in  the  legislature  were  soon  removed  or,  as  in  the  United 
States,  never  obtained  legal  recognition.  But  the  en- 
franchisement was  at  bottom  more  nominal  than  real, 
since  there  was  as  yet  no  possibility  for  the  poor  people 
to  hold  office  or  to  swing  a  vote  against  the  concerted 


THE  LIMITS  IN  GOVERNMENT  215 

action  of  the  rich  industrials  and  the  landed  aristocracy. 
Those  who  held  the  purse  controlled  the  government  more 
than  ever.  The  vaunted  signs  of  popular  sovereignty 
proved  to  be  pleasant  deceptions  that  could  not  compen- 
sate the  masses  for  their  impotence  in  the  legislative  halls. 
As  the  decades  have  rolled  by  observers  have  become  more 
and  more  convinced  that  something  else  is  needed  than 
the  universal  ballot  to  ensure  a  rule  of  the  people  by  the 
people,  supposing  that  such  a  motto  is  really  recommend- 
able. 

As  one  American  writer  has  recently  put  it :  "  Uni- 
versal suffrage  has  not  given  us  a  democratic  industrial 
system.  The  enfranchised  many  have  failed  to  translate 
their  democratic  ideals  into  economic  fact."  *  If  it  is 
true,  as  W.  Godwin  believed  in  his  own  day,  that  "  de- 
mocracy is  a  system  of  government  according  to  which 
every  member  of  society  is  considered  as  a  man,  and  noth- 
ing more,"  2  then  we  are  not  anywhere  near  our  goal,  the 
use  of  the  representative  principle  of  government  notwith- 
standing. 

But  of  course  the  real  question  is:  How  far  should 
government  be  turned  over  to  the  populace,  to  a  plebiscite 
on  public  problems,  and  what  is  the  verdict  of  social 
science  as  to  the  scope  of  popular  rule? 

The  pamphleteers  of  the  period  of  Enlightenment,  it  is 
evident,  had  no  appreciation  of  the  real  nature  of  the  sub- 
ject they  discussed  so  glibly  now  to  vindicate  absolutism, 
now  to  forfend  the  rights  of  the  citizen.  To  them  man 
was  a  finished  product  of  reason  chiefly,  and  society  a 
state  designed  calculatingly  by  its  members  at  an  early 

1  Hamilton,   W.    H.,   "The    Price    System   and   Social   Policy,"   in 
Journal  of  Political  Economy  for  Jan.,  1918. 

2  Godwin,  W.,  "  Inquiry  Concerning  Political  Justice,"  Book  Five, 
Chapter  14,  where  Aristotle's  famous  definition  of  democracy  is  cited 
with  approval. 


216  THE  LIMITS  OF  SOCIALISM 

stage  of  human  development.  The  historical  sense  had 
not  yet  been  cultivated.  The  perspective  was  that  of  the 
artist  who  studies  a  completed  picture,  rather  than  that 
of  a  traveler  who  beholds  everchanging  scenes  and  new 
possibilities  for  investigation.  To  the  absolutists,  if  gov- 
ernment was  divinely  ordained,  harmony  between  monarch 
and  subject  must  in  the  long  run  prevail.  As  for  the  con- 
stitutionalist, especially  if  he  accepted  the  theory  of  a 
social  contract,  a  clash  of  interests  could  be  quickly  set- 
tled by  a  resort  to  arms,  but  he  supposed  after  all  that 
the  contract  had  been  so  lucidly  drawn  up,  in  full  view 
of  the  inborn  and  inalienable  rights  of  man,  that  an 
estrangement  between  the  two  parties  was  not  to  be  ex- 
pected. 

But  the  modern  view  of  the  situation  cannot  be  quite 
so  simple. 

Manifestly  government  and  people  cannot  associate  so 
fraternally  on  a  level  as  the  publicists  pictured  it. 
Rather,  the  two  will  unavoidably,  in  a  certain  sense,  be- 
come strangers  for  the  same  reason  that  boards  of  di- 
rectors over  a  large  corporation  move  in  a  world  differ- 
ent from  that  of  the  employees.  It  is  not  a  question  of 
class  privileges  or  of  social  stratification,  but  of  special- 
ization in  work  and  interests. 

A  government  becomes  a  piece  of  social  machinery 
apart  from  the  general  run  of  people  because  of  the  type 
of  men  composing  it  and  because  of  its  duties  which  eo 
ipso  imply  unique  viewpoints.  A  government,  if  it  func- 
tions long  enough  undisturbedly,  will  accumulate  secrets 
of  trade  just  as  truly  as  a  business  concern,  and  in  addi- 
tion it  is  bound,  in  the  very  nature  of  its  work,  to  guard 
important  secrets  of  international  relations.  Within 
limits  all  governments  are  self-perpetuating  bodies,  for  no 
change  of  party  or  power  of  ballot  can  prevent  the  rise 


THE  LIMITS  IN  GOVERNMENT 

of  an  elite  which,  on  account  of  its  capacities  and  experi- 
ence, tends  to  keep  close  to  the  throne,  distributing  offices 
among  its  members.  Government  cannot  be  anything  else 
than  a  business,  if  by  that  term  we  designate  a  routine 
of  work  and  a  center  of  interests  relative  to  which  all 
others  appear  secondary.  The  governors  must  act  fre- 
quently as  though  their  interests  were  undeniably  the  con- 
cern of  all  the  governed,  even  when  a  difference  of  opinion 
might  arise  at  a  testing.  This  is  the  fundamental  fact  in 
the  handling  of  international  matters,  and  on  this  score 
the  monarchists  of  old  condemned  popular  sovereignty. 

But  furthermore,  Government  ere  long  means  for  any 
nation  a  set  of  rules  solemnly  recorded  and  carefully  pre- 
served. It  becomes  a  code  of  conduct  revered  by  the 
people,  who  are  taught  to  regard  nothing  more  sacred 
than  the  laws  of  the  land,  even  though  they  challenge 
science  and  common  sense.  Government  to  many  people 
becomes  an  institution  and  a  habit,  a  court  of  wisdom  and 
a  seat  of  coercive  power  from  which  there  is  no  appeal. 
The  average  man  gives  his  assent  by  obeying.  That  is  his 
way  of  proving  his  rights  of  citizenship  unless  a  special 
occasion  arises. 

§  2.  The  Premises  of  Democracy. —  But  in  a  deeper 
sense  the  millions  can  only  be  indirect  agents  of  govern- 
ment, not  the  immediate  supervisors  of  it,  as  once  was 
believed. 

Democracy  is  an  ideal  of  government  essential  to  the 
progress  of  man,  but  based  on  assumptions  for  the  most 
part  in  conflict  with  known  facts.  The  value  of  democ- 
racy is  therefore  not  its  literal  interpretation,  but  its  psy- 
chological effect  upon  people  who  would  do  more  than  they 
can,  who  need  encouragement  the  more  marked  their  limit- 
ation, and  who  should  have  the  abstraction  of  justice  on 
their  side  no  matter  how  difficult  its  realization  in  details. 


218  THE  LIMITS  OF  SOCIALISM 

The  premises  of  democracy  are,  first,  that  all  people 
know  what  is  needed  for  public  welfare,  second,  that  all 
people  express  their  will  at  the  voting  booth,  and  third, 
that  all  those  elected  to  office  will  do  the  bidding  of  the 
people.  If  we  grant  these  three  points  we  are  safe  in  de- 
manding an  unreserved  literal  exercising  of  popular 
sovereignty,  but  the  less  faith  we  have  in  the  postulates 
the  more  we  shall  be  inclined  to  favor  a  democracy  for  the 
people  by  some,  but  not  by  all,  of  the  people.  If  the 
great  majority  were  qualified  to  pass  judgment  on  politi- 
cal problems,  and  if,  having  formed  a  judicious  opinion, 
they  proceeded  to  express  that  and  nothing  else  with  the 
understanding  that  their  nominees  would  carry  out  to  the 
fullest  of  their  abilities  the  opinion  and  wishes  recorded  in 
the  ballot,  then  the  more  truly  representative  a  govern- 
ment would  be,  the  finer  the  results  for  all  parties  con- 
cerned. The  theory  of  democracy  allows  itself  consid- 
erable license  in  the  premises  for  the  sale  of  a  noble  wish ! 

The  obstacles  to  such  unhampered  democracy  are  how- 
ever many;  and  they  are  of  a  kind  calculated  to  instill 
much  respect. 

For  as  to  the  first  premise  we  can  admittedly  not  rely 
on  intuitions.  What  is  sound  policy  for  a  nation  can- 
not be  inferred  from  scruples  of  conscience,  nor  is  it  to 
be  read  from  the  heavens  above.  Social  phenomena  are 
of  all  correlations  the  most  complex.  We  have  not  yet 
progressed  far  in  mastering  them.  We  may  never  feel 
toward  them  as  the  physicist  feels  about  his  facts  of 
matter  and  force  or  motion.  It  requires  long  training 
and  deep  attention  to  seeming  trifles  to  form  an  opinion 
of  worth  on  matters  sociological.  Many  facts  must  be 
balanced  and  compared;  far  more  facts  than  the  natural 
scientist  ordinarily  reckons  with.  Hence  the  uncertainty 


THE  LIMITS  IN  GOVERNMENT 

of  some  rules  in  social  inquiries,  and  hence  the  need  of 
prolonged  study  for  the  would  be  citizen. 

But  the  schooling  of  the  masses  has  been  hitherto  un- 
fair to  them.  It  has  been  faulty  for  several  reasons,  one 
being  a  one-sided  emphasis  on  subjects  remote  from  our 
present  environment,  and  a  second  the  exclusion  of  the 
great  majority  from  the  higher  curricula.  Education 
uptodate  could  never  have  been  adequate  to  all  ideals  or 
needs,  for  our  limits  in  production  unavoidably  debarred 
millions  from  its  blessings.  As  was  shown  earlier,  if  we 
wish  to  extend  to  all  children  what  we  now  grant  ten 
per  cent,  of  them  we  shall  have  to  work  much  harder  and 
greatly  improve  our  methods  of  work  in  factory  and  home. 
To-day  only  ten  out  of  each  hundred  enter  high  school, 
and  less  than  two  per  cent,  matriculate  for  college  work. 
The  remainder,  the  overwhelming  majority,  is  sent  to  the 
workbench  at  the  age  of  fourteen  or  fifteen,  equipped  with 
a  scant  reading  and  writing  knowledge,  but  not  taught  to 
think  closely,  to  connect  cause  and  effect,  to  survey  a 
wide  gamut  of  facts,  to  pierce  the  shell  of  things  in  order 
to  reach  a  sympathetic  understanding  of  what  at  first 
sight  may  seem  gross  injustice  or  a  trite  detail.  We  have 
given  the  masses  the  ability  to  read,  but  not  to  compre- 
hend things.  We  have  trained  them  in  the  crafts,  but  not 
in  the  sciences  nor  in  the  supreme  art  of  living.  Their 
abilities,  such  as  they  are,  have  not  been  unfolded  accord- 
ing to  the  best  prescriptions  of  the  pedagogue.  Accurate 
information  is  always  scarce,  but  the  exclusion  of  many 
millions  of  willing  students  from  the  higher  branches  of 
learning  has  made  doubly  precarious  the  hold  of  democ- 
racy. 

It  is  acknowledged  by  one  scholar  that  a  true  public 
opinion  "  can  be  formed  where  the  bulk  of  the  people 


220  THE  LIMITS  OF  SOCIALISM 

are  in  a  position  to  determine  of  their  own  knowledge  or 
by  weighing  evidence  a  substantial  part  of  the  facts  re- 
quired for  a  rational  decision,"  but  he  adds  that  "  knowl- 
edge of  facts  becomes  increasingly  difficult."  3  A  grow- 
ing complexity  of  life  and  widening  of  economic  interests 
has  accentuated  the  difficulties  of  old,  while  our  educa- 
tional system  has  failed  to  take  due  account  of  them  in 
preparing  people  for  true  democracy. 

Socialists  may  of  course  promise  to  remedy  this  defect 
so  that  everybody  will  be  able  to  know  what  is  going  on, 
anxious  as  well  as  able  to  participate  actively  in  politics. 
One  is  involuntarily  captivated  by  the  prospect  of  a  social 
order  in  which  all  of  us  get  a  chance  to  master  the  es- 
sentials in  natural  or  social  science.  However,  it  would  be 
a  grievous  mistake  to  bank  extravagantly  on  the  possibili- 
ties of  formal  schooling.  We  may  extend  educational 
facilities  to  a  marked  degree  without  obtaining  propor- 
tionate returns  in  intelligence.  It  is  not  true  that  a  fixed 
ratio  of  the  one  to  the  other  exists.  Rather,  we  all  know 
of  types  of  human  beings,  some  of  them  bound  to  succeed 
in  life  while  others  fall  by  the  wayside.  Human  nature 
comes  in  types  more  or  less  fixed  and  regularly  recur- 
rent, as  the  biologist  knows.  We  have  the  strong  and  the 
frail,  the  clever  and  the  stupid,  the  imitators  and  the  in- 
novators, the  crafty  and  the  naive,  the  energetic  and  the 
indolent,  the  courageous  and  the  craven,  the  stubborn  and 
the  docile,  and  so  forth.  These  classes  of  people  get  dif- 
ferent results  out  of  the  same  instructional  course.  It 
is  not  to  be  supposed  that  all  will  benefit  by  guidance  re- 
ceived in  the  study  of  social  problems,  or  that,  having 
been  informed  as  to  the  relevant  facts,  they  will  all  draw 
the  conclusions  most  important  for  the  exercise  of  the 
rights  of  citizenship.  We  may  count  on  many  ignora- 
3  Lowell,  A.  L.,  "  Public  Opinion  and  Popular  Government,"  p.  46. 


THE  LIMITS  IN  GOVERNMENT 

muses  even  when  science  is  more  conscientiously  dissemin- 
ated. People  do  not  entirely  select  their  data  from  a 
social  standpoint.  Though  cognizant  of  certain  facts 
they  will  ignore  them  for  the  sake  of  emphasizing  their 
own  needs.  This  is  the  obstacle  mainly  interfering  with  an 
impartial  application  of  knowledge  to  practical  politics. 
The  masses  succumb  to  emotions  when  reason  alone  should 
govern.  The  type  that  acts  on  analysis  is  in  the  minority 
distinctly,  and  this  type  will  do  the  directing  whether 
education  has  enlightened  the  populace  or  not. 

The  second  premise,  therefore,  loses  force  also,  for  just 
because  of  the  predominance  of  the  strong,  calculating, 
far-seeing  minority  the  great  majority  seldom  remains 
true  to  its  convictions.  Or  rather,  it  receives  its  ideas 
from  a  small  group  whose  word  and  suggestion  superin- 
tends the  casting  of  the  vote.  Social  control  reigns 
everywhere.  The  average  man  does  not  spend  his  time 
thinking  out  any  particular  problem  in  production  or 
government,  but  he  expects  somebody  else  to  give  him 
a  problem  ready  made,  much  of  the  solution  being  already 
outlined.  Under  those  conditions  he  will  work  cheerfuUy 
and  deliver  a  product,  but  not  otherwise. 

Imitation  and  suggestion  thus  become  staple  devices 
for  learning  and  for  exerting  influence.  The  masses 
absorb  the  opinions  of  leaders  as  a  sponge  absorbs  water. 
They  fall  a  prey  to  suggestibility  and  follow  out  com- 
mands adroitly  administered.  From  the  press  or  from 
the  pulpit,  from  the  employer  and  from  friends,  from  the 
political  machine  and  relatives  the  most  of  us  get  our 
ideas  as  to  what  is  right  and  what  we  should  vote  for. 
The  press  especially  wields  an  enormous  influence  over 
people's  minds.  It  molds  opinion  more  than  it  passively 
reflects  it,  for  the  brain  of  the  editorial  staff  is  superior 
to  that  of  the  majority,  and  where  the  staff  is  under  the 


THE  LIMITS  OF  SOCIALISM 

control  of  industrialists  or  public  officials  it  at  any  rate 
still  spreads  views  not  primarily  developed  by  the  gen- 
eral run  of  subscribers. 

Ward  bosses  similarly  may  move  us  to  vote  regardless 
of  our  personal  desires.  We  listen  to  them  and  feel 
prompted  to  credit  them  with  superior  wisdom.  Or  we 
make  of  political  creed  a  family  affair,  the  son  follow- 
ing his  father's  party,  actuated  partly  by  a  sense  of 
loyalty  or  the  propriety  of  things,  and  partly  by  the 
force  of  habit.  Thus  we  do  not  ask  why  certain  men 
are  nominated  in  the  convention,  or  why  their  names  ap- 
pear on  the  ballot.  We  do  not  go  into  the  history  of  the 
candidates,  except  that  the  party  leaders  will  consider 
it  somewhat  in  their  proposal  for  nomination.  The 
wishes  of  the  employer  may  mean  more  to  us  than  our  pri- 
vate views,  for  there  are  avenues  that  lead  to  distant  goals, 
and  blind  alleys  that  lead  us  nowhere.  Nobody  likes  to 
risk  much  without  a  chance  of  gain.  Whether  it  be 
bribery  or  promises  of  advancement,  whether  it  be  a  mere 
whim  or  the  innuendos  of  relatives,  whether  it  be  from 
indifference  or  because  of  pressure  brought  to  bear  upon 
men  illicitly,  men  have  voted  regardless  of  what  they 
believed,  and  they  will  do  so  again.  Few  act  on  decisions 
painstakingly  grounded.  Not  all  are  in  a  position  to 
vote  precisely  as  they  please,  even  if  the  law  protects  them. 
The  ballot  reflects  public  opinion,  of  course,  but  it 
originates  with  a  small  minority  whose  powers  of  percep- 
tion and  of  control  are  plainly  in  view. 

Democracy,  thus,  is  the  will  of  the  majority  radiating 
from  select  groups  who,  by  courting  the  consent  of  the 
masses,  succeed  in  legalizing  what  once  did  not  need  the 
sanction  of  law.  Political  theory,  in  other  words,  is  far 
ahead  of  practice.  "  No  government,"  wrote  Mill  in  his 
magnificent  essay  on  Liberty,  "  by  a  democracy  or  a 


THE  LIMITS  IN  GOVERNMENT 

numerical  aristocracy,  either  in  its  political  acts  or  in  the 
opinions,  qualities,  and  tone  of  mind  which  it  fosters,  aver 
did  or  could  rise  above  mediocrity  except  in  so  far  as  the 
sovereign  Many  have  let  themselves  be  guided,  which 
in  their  best  times  they  always  have  done,  by  the  counsels 
and  influence  of  a  more  highly  gifted  and  instructed  One 
or  Few.  The  initiative  of  all  wise  or  noble  things  comes 
and  must  come  from  individuals ;  generally  at  first  from 
some  one  individual.  The  honor  and  glory  of  the  average 
man  is  that  he  is  capable  of  following  that  initiative — ."  4 
And  in  the  words  of  a  contemporary  writer :  "  We  are 
governed  by  minorities  just  as  industries  are  controlled 
by  them.  The  problem  is  not  to  escape  control,  but  to 
transform  society  so  that  wisdom  dominates."  5 

As  to  the  third  premise.  The  people  look  naturally 
to  leadership,  even  though  at  times  they  are  disappointed. 
They  take  for  granted  that  their  wishes  will  in  the  main 
be  honored  by  the  legislator.  Yet  the  pledges  for  such 
obedience  on  the  part  of  men  in  office  are  few  and  in- 
definite. Party  platforms  promise  much,  but  are  notable 
for  lack  of  clarity  in  expression,  of  precision  in  the 
enumeration  of  particulars.  The  particulars  cannot 
often  be  given,  for  most  needs  arise  after  men  have  been 
installed  in  office.  The  barest  outline  of  policies  is 
offered,  but  one  cannot  judge  from  that  as  to  the  final 
interpretation  to  be  put  upon  them.  Either  the  measures 
to  be  acted  on  cannot  be  discussed  beforehand  to  any  ex- 
tent, or  the  thoughts  are  couched  in  phrases  susceptible 
of  several  constructions.  Once  the  governors  begin  their 
work  the  means  of  checking  them  up  prove  strikingly  in- 
effective. There  is  no  way  of  judging  except  to  obey  im- 
pulses of  the  moment.  A  hostile  press  may  open  our  eyes, 

*  Mill,  J.  S.,  "  On  Liberty,"  Chapter  3. 

s  Patten,  S.  N.,  "  The  Reconstruction  of  Economic  Theory,"  p.  75. 


THE  LIMITS  OF  SOCIALISM 

or  an  honest  opponent  may  point  out  errors  and  de- 
linquencies, but  beyond  that  the  axiom  of  responsible 
ministry  is  purely  nominal.  Responsibility  is  to  public 
opinion,  not  to  wishes  registered  at  the  poll.  It  is  to  de- 
mands agitated  among  the  reigning  economic  classes,  not 
to  principles  formulated  by  science.  The  latter  so  far 
has  enjoyed  but  a  passive  share  in  the  administration  of 
public  affairs. 

Whichever  way  we  look  at  the  situation  we  cannot  get 
away  from  the  limitations  inherent  in  popular  control. 
Democracy  always  will  turn  out  to  be  a  set  of  rules  by 
which  the  minority  is  permitted,  willy  nilly,  to  govern 
the  majority.  A  few  outline  the  policies,  that  the  multi- 
tudes may  put  the  stamp  .of  their  approval  upon  them 
and  thus,  by  rights  of  suffrage  and  representation,  become 
parties  to  a  transaction  which  few  of  them  really  com- 
prehend. The  value  of  political  democracy,  therefore,  is 
not  the  equalization  of  powers  of  judgment,  for  that  lies 
far  in  the  future,  but  the  submission  of  the  mighty,  always 
in  theory,  and  in  practice  now  and  then,  to  the  will  of 
the  weak.  For  the  same  reasons  that  a  part  of  our  social 
surplus  of  goods  produced  by  exceptional  talents  should 
go  to  the  normal  or  deficit  producers,  the  civic  rights 
and  duties  should  be  substantially  equalized,  so  each  may 
feel  worthy  of  a  place  in  the  social  order.  To  humble  the 
mighty  may  at  times  be  necessary.  The  vote  and  the 
election  campaigns  preceding  the  voting  help  to  fortify 
the  masses  against  too  deep  a  sense  of  their  own  in- 
feriority. What  an  excess  of  self-assertion  leads  to  we 
are  told  often  enough,  but  immoderate  subjection  of  the 
Self  to  class  standards  is  equally  reprehensible. 

The  casting  of  a  vote  is  symbolic  of  the  power  of 
numbers  which  the  average  voter  represents.  To  know 
that  certain  offices  are  legally  open  to  us  even  when  we 


THE  LIMITS  IN  GOVERNMENT 

do  not  aspire  to  them  is  consoling,  and  a  spur  to  our 
spirit  of  enterprise.  Democracy  politically  draped  is 
valuable  for  these  reasons.  It  puts  a  premium  on  social 
cohesion,  on  united  action  by  all  regardless  of  differen- 
tiations. It  harmonizes  with  our  knowledge  of  human 
nature.  For  the  lowly  are  not  impotent  unless  we  deny 
them  assistance.  The  slow-witted  need  not  be  a  burden 
until  we  belittle  their  ambitions.  All  of  us  feel  obliga- 
tions until  we  are  declared  irresponsible.  The  bane  of 
aristocracy  is  its  tendency  to  declare  inert  what  is  quick 
with  life,  and  to  curb  development  among  the  mediocre. 
In  a  democracy  like  the  socialistic  all  will  have  a  right  to 
do  the  unexpected,  provided  it  helps  the  public  at  large. 
It  will  be  for  the  governors  to  encourage  every  effort  to- 
ward self  betterment  and  to  use  the  data  of  science  so  that 
self  and  society  become  one. 

§3.  Obstacles  to  Internationalism — For  a  long  time 
to  come,  however,  governments  will  have  to  combine 
science  with  strategy,  for  nationalism  implies  two 
policies  very  different  in  principle.  As  trustees  of  the 
people  a  government  should  act  honestly,  with  the  re- 
gard that  one  member  in  a  partnership  has  for  the 
other.  But  as  soon  as  we  scent  a  conflict  of  interests  be- 
tween nations  we  must  admit  the  value  of  statecraft  in  a 
competitive  sense. 

The  scientist  should  be  first  of  all  creative  and  truth- 
ful. Nothing  counts  but  the  facts.  Service  is  the  key- 
note of  labor,  and  candor  a  supreme  virtue  among  col- 
laborators. The  government  is  such  an  agent  of  truth 
and  service  when  it  deals  with  its  own  constituency.  But 
in  its  dealings  with  a  hostile  outside  world  it  must  show 
discretion  regardless  of  rights  of  duties.  It  must  add 
the  cunning  of  the  fox  to  the  strength  of  the  lion.  It 
must  seek  to  achieve  by  circumlocution  or  by  a  ruse  what 


226  THE  LIMITS  OF  SOCIALISM 

it  could  not  gain  by  frankness  or  amicable  advances. 
Governments  are  necessarily  suspicious  of  each  other  as 
long  as  they  claim  sovereignty  amidst  radically  different 
conditions  for  prosperity.  A  nation  therefore  needs  two 
sorts  of  men  and  several  criteria  of  conduct ;  one  to  govern 
it  at  home  and  the  other  to  guard  it  against  lurking  foes. 
The  partnership  of  truth  and  falsehood  can  scarcely  be 
dissolved  as  long  as  nationalism  prevails  and  different 
sovereignties  compete  for  supremacy. 

As  for  the  rights  of  its  own  citizens  a  government 
should  subordinate  them  to  the  welfare  of  the  great  ma- 
jority. The  functions  of  government,  in  this  respect, 
will  vary  with  time  and  place.  No  one  principle  can  be 
laid  down  by  which  the  people  are  to  ensure  to  themselves 
utmost  personal  liberty  or  a  maximum  of  social  striking 
power. 

It  is  true,  as  H.  Spencer  emphasized,  that  social  jus- 
tice consists  in  that  "  every  man  has  freedom  to  do  all 
that  he  wills,  provided  he  infringes  not  the  equal  free- 
dom of  any  other  man,"  6  but  just  when  the  infringement 
takes  place  we  do  not  know,  except  at  a  given  time  and 
place.  Similarly,  when  J.  S.  Mill  observes  that  "  the 
only  part  of  the  conduct  of  any  one  for  which  he  is  amen- 
able to  society  is  that  which  concerns  others  "  7  we  will 
agree  offhand.  But  how  shall  we  determine  what  actions 
are  of  social  import,  and  which  concern  solely  the  indi- 
vidual? The  proper  sphere  of  government  is  not  found 
as  easily  as  was  thought  by  the  Manchestrians.  We  have 
abandoned  the  theorem  that  government  is  an  evil  and 
self-expression  naturally  a  virtue.  We  have  individually 
perhaps  held  control  to  be  a  sad  duty,  a  necessary  evil, 

•  Spencer,  H.,  "  Ethics,"  Part  Four,  Justice,  Chapter  6,  No.  27. 
T  Mill,  J.  S.,  "  On  Liberty,"  Introductory. 


THE  LIMITS  IN  GOVERNMENT 

but  at  the  same  time  we  have  found  out  that  liberty  is 
not  so  much  a  reservation  of  rights  to  say  and  do  things 
as  one  of  duties  by  the  observance  of  which  the  largest 
possible  number  of  people  in  a  given  area  can  master  the 
complexity  of  civilization. 

The  history  of  American  ideals  of  democracy  is  an  in- 
structive example  of  this  relativity  of  freedom.  Pater- 
nalism was  once  decried  as  something  un-American,  as 
smacking  of  monarchy.  But  increasingly  as  the  western 
frontier  has  disappeared,  as  city  life  has  encroached  on 
the  country  side,  as  density  of  population  has  increased 
and  our  economic  organization  has  expanded  and  become 
more  intricate,  increasingly  in  about  the  same  measure  we 
have  added  to  our  functions  of  federal  and  local  govern- 
ment, until  to-day  warnings  to  do  and  not  to  do  certain 
things  greet  us  on  all  sides.  Laws  have  been  passed  on 
behalf  of  the  citizen  which  two  generations  ago  would 
have  seemed  as  ridiculous  as  indeed  they  would  have  been 
inappropriate.  What  twenty  million  agriculturally  en- 
gaged Americans  considered  good  government  is  one  thing, 
and  what  a  seething  mass  of  urbanites  without  land,  hud- 
dled together  like  sheep  in  a  pen,  deem  adequate  govern- 
ment is  quite  another  thing.  It  would  not  be  an  exaggera- 
tion to  say  that  functions  of  government  grow  in  propor- 
tion to  density  of  population  and  to  per  capita  production 
of  goods. 

Democracy  certainly  must  anticipate  dark  days  when 
social  relations  become  too  interlaced;  for  it  may  mean 
that  social  stratification  is  sanctioned  and  the  an- 
tagonism of  economic  groups  openly  recognized.  It  is 
when  this  stage  of  structural  development  has  been  reached 
that  international  relations,  too,  assume  a  sinister  aspect. 
The  functions  of  government  will  then  proclaim  a  new 


228  THE  LIMITS  OF  SOCIALISM 

norm  of  individualism,  one  that  would  outrage  the  in- 
dividualistic sense  of  the  primitive  man,  say  of  the  col- 
onist in  Jacksonian  days. 

The  prerogatives  of  sovereignty,  however,  are  most 
fully  invoked  in  international  relations.  It  is  here  that 
the  individual  is  nothing  and  the  state  everything.  The 
government  acts  on  behalf  of  all  its  citizens  against  the 
presumption  of  outsiders.  It  speaks  as  though  the  citi- 
zens were  temporarily  a  means  to  an  end,  the  end  being 
the  promotion  of  interests  as  understood  by  the  gover- 
nors. Minority  rule  is  then  most  in  evidence.  Leader- 
ship and  might  carry  the  day.  The  weal  and  woe  of  un- 
told millions  rests  in  the  hands  of  a  very  few  men  steering 
the  ship  of  state.  The  principle  of  competition  holds 
sway,  and  nations  match  their  rights  as  they  ordinarily 
match  their  goods  in  a  search  for  markets. 

The  nation  is  not  presumably  as  old  as  the  race  or  tribal 
unit.  It  depends  upon  our  definitions  of  both.  But 
there  is  ample  evidence  to  show  that  blood  ties  have  never 
limited  the  expansion  of  groups.  Whatever  race  charac- 
teristics may  be,  peoples  of  different  physical  make-up 
of  different  languages  and  literatures,  have  been  united 
under  one  common  rule  and  fought  shoulder  to  shoulder 
against  their  own  kinsmen  as  well  as  against  aliens.  The 
nation  has  always  proven  to  be  a  union  of  individuals 
welded  by  exceptional  leadership.  Leaders  of  men  have 
fought  each  other,  and  external  circumstances  have 
prompted  people  to  side  with  one  or  the  other.  Groups 
have  been  made  strong  by  a  minority  which,  taking  upon 
itself  the  onus  of  battle  and  vigilance,  wa's  given  the  con- 
trol of  internal  affairs  no  less  than  of  warfare. 

A  nation  is  the  product  of  force.  Leadership  has  made 
it.  Sovereignty  is  the  absolute  right  of  leaders  to  safe- 
guard their  nation  against  the  attacks  of  rival  nations. 


THE  LIMITS  IN  GOVERNMENT          229 

Such  were  the  original  attributes  of  the  sovereign,  along- 
side of  which  the  rights  of  jurisdiction  and  of  taxation 
developed  early.  A  nation  may  not  be  economically  self- 
sufficient.  It  rarely  has  been.  But  it  always  represents 
an  organization  of  fighters  who  will  place  their  own  wel- 
fare above  that  of  any  outsider.  This  is  a  rule  the  ex- 
ceptions to  which  are  few  and  far  between. 

The  .more  advanced  our  methods  of  production  the 
larger  a  nation  may  grow,  for  plainly  it  requires  either 
physical  force  or  solidarity  of  interests  to  govern  mil- 
lions from  a  single  center.  The  Ancients,  and  notably  the 
Romans,  succeeded  in  building  vast  empires  covering  mil- 
lions of  square  miles  because  their  organization  of  fighters 
had  no  equal.  On  the  other  hand,  nations  may  become 
strong  numerically  if  they  are  able  to  find  enough  food  on 
a  small  area,  or  to  purchase  it  with  finished  products. 
This  was  commonly  the  case  since  the  discovery  of  new 
continents,  with  immense  natural  resources  awaiting  ex- 
ploitation, has  furnished  European  nations  a  welcome  out- 
let for  manufactures.  Race  ideals  have  always  been  an 
impediment  to  aggressive  nations,  but  not  an  invincible 
one.  Differences  in  language  and  intellectual  traditions, 
in  religion  and  in  physical  traits  such  as  color  and  stature 
have  tended  to  keep  people  apart.  Yet  these  natural 
barriers  have  not  always  prevented  a  conqueror  from 
gathering  under  his  scepter  a  mighty  host  of  subjects. 

What  must  determine  the  size  of  nations  is  chiefly  tech- 
nical means  of  communication,  travel,  and  transportation, 
methods  of  production,  the  disposition  of  natural  re- 
sources, and  principles  of  government.  As  long  as  topo- 
graphical conditions  vary  greatly,  as  long  as  mountains 
and  water  could  separate  people  by  making  travel  impos- 
sible, as  long  as  sparsity  of  resources  kept  people  poor 
and  widely  scattered,  so  long  the  agglomeration  of  many 


230  THE  LIMITS  OF  SOCIALISM 

millions  under  a  single  flag  was  out  of  the  question.  And 
for  precisely  these  reasons  nationality  will  be  a  dominant 
factor  for  centuries  to  come. 

There  will  never  be  enough  time  and  wealth  to  permit  mi- 
gration at  regular  intervals  for  the  exchange  of  interests, 
thoughts,  and  manners.  Physiographic  differences  are 
bound  to  differentiate  peoples  in  different  continents,  or 
even  within  one  continent.  The  historical  background  of 
the  ancient  world  is  so  much  a  part  of  its  modern  inhabi- 
tants that  they  can  never  hope  to  rid  themselves  entirely 
of  its  fatal  effects  for  purposes  of  internationalism. 
There  is  no  promise  of  an  amalgamation  of  races  or  of  na- 
tionalized groups.  The  socialists  admit  this,  and  others 
assume  it  is  a  matter  of  course. 

If  socialism  then  speaks  of  cosmopolitanism  it  cannot  be 
with  the  desire  to  abrogate  nationalism,  but  only  to  the 
end  that  a  better  understanding  between  the  several  sov- 
ereign units  may  be  attained.  Socialism  is  eager  to  fund 
sentiments,  as  it  has  professed  great  faith  in  the  funding 
of  goods.  The  most  ardent  of  socialists  would  abridge 
sovereign  rights  so  as  to  make  individual  nations  amen- 
able to  an  international  tribunal  representing  the  whole 
world.  The  underlying  thought  is  the  liberation  of  the 
masses  from  the  yoke  of  capitalism,  but  the  incidental 
feature  is  the  abolition  of  wars.  Socialism  pins  its  faith 
in  the  goodness  of  human  nature  as  found  in  the  average 
man.  It  places  the  responsibility  for  class  struggle  and 
international  strife  with  the  magnates  of  business,  con- 
fident that  a  reorganization  of  the  industrial  system  would 
disarm  them  and  free  mankind  from  a  horrible  incubus. 
Socialism  wishes  to  limit  sovereignty,  but  not  the  duties 
of  government.  In  this  respect  its  aims  are  diametrically 
opposed  to  those  of  Laissez  Faire  and  of  competitive  capi- 
talism, which  stress  the  need  of  nationalism  as  over  and 


THE  LIMITS  IN  GOVERNMENT 

against  the  rights  of  the  individual  within  each  nation. 
The  issue  is  clearly  defined. 

But  in  order  to  agree  to  the  limits  of  socialistic  govern- 
ment we  must  first  distinguish  between  superficial  and 
basic  causes  of  war.  Lack  of  communication  cannot  ex- 
plain them,  for  in  the  very  century  that  the  means  of 
communication  and  travel  were  most  perfected,  intelligence 
being  flashed  across  continents  and  oceans  with  lightning 
speed,  wars  have  been  as  common  as  ever,  besides  being 
conducted  on  a  much  larger  scale.  Nor  is  the  type  of 
government  apparently  a  decisive  factor,  considering  that 
democracies  have  fought  as  lustily  as  autocracies.  The 
overthrow  of  absolutism  did  not  spare  France  or  England 
any  wars.  Neither  have  the  South  American  republics  or 
the  United  States  escaped  them  entirely,  though  thanks 
to  their  youth,  perhaps,  and  to  their  remoteness  from  the 
centers  of  trade  they  suffered  less  than  the  Europeans. 

And  in  the  third  place  it  would  be  folly  to  attribute 
wars  to  economic  pressure  if  that  is  to  mean  lack  of  food 
or  of  the  necessaries  of  life  as  the  masses  know  them. 
Wars  have  been  as  plentiful  in  the  days  of  cavedwellers 
as  to-day.  Density  of  population  has  not  multiplied 
them,  nor  has  the  modern  abundance  of  necessities  made 
them  impossible.  Regardless  of  an  abundance  of  supplies 
nations  have  entered  upon  costly  wars ;  regardless  of 
needs,  measurable  by  individual  standards,  governments 
have  declared  themselves  constrained  to  levy  armies  either 
in  self  defense,  or  on  behalf  of  third  parties. 

Hence  the  meaning  of  the  indisputable  fact  that  wars 
must  be  traced  to  economic  pressure  is  somewhat  different 
from  the  one  commonly  accepted.  It  has  to  do  not  only 
with  the  "  economic  man  "  that  economics  has  so  often  al- 
luded to,  but  likewise  with  types  of  men  and  their  role  in 
social  growth. 


THE  LIMITS  OF  SOCIALISM 

The  economic  man  is  a  product  of  evolution.  The  uni- 
versal surplus  of  seed  coupled  with  the  scarcity  of  foods 
brought  about  a  struggle  in  which  pugnacity  and  ac- 
quisitiveness became  invaluable  assets.  Those  who  would 
or  could  not  fight  to  acquire  a  subsistence  were  inevi- 
tably killed  off.  The  instinct  of  self-preservation  could 
express  itself  in  no  other  way  than  in  willingness  and  abil- 
ity to  fight  for  the  biologically  essential  things.  The  sex 
struggle  was  an  accompaniment  of  the  contest  for  self- 
preservation,  the  two  being  inseparably  connected. 

The  course  of  history  points  to  the  effect  of  economic 
conditions  upon  the  development  of  social  norms,  but  the 
innate  faculties  of  man  were  in  turn  the  means  for  en- 
larging the  economic  environment.  Thus  the  selfish  in- 
stincts eventually  aided  in  the  arousal  of  a  group  con- 
sciousness almost  as  strong  as  parental  love  and  sex 
passion.  The  original  need  of  food  ceased  to  preoccupy 
men.  They  specialized  more  and  more  for  the  accumula- 
tion of  non-necessities  which  their  imagination  made  de- 
sirable, and  the  possession  of  which  meant  power.  That 
is  to  say,  since  strength  like  everything  else  is  relative, 
the  means  to  survival  were  not  simply  an  abundance  of 
food,  but  all  those  instruments  by  which  an  enemy  could 
be  subjugated  in  a  battle.  Not  the  mere  muscular 
strength,  but  ax  and  arrow,  sword  and  scimitar  became 
important,  and  again  not  weapons  but  means  of  defense, 
like  walls  and  citadels,  moats  and  armor,  decided  the  issue. 
And  later  on  subtler  devices  warded  off  the  foe.  The 
power  of  body  was  dwarfed  by  the  force  of  explosives. 
Armor  plate,  instead  of  shielding  the  knights,  was  used  to 
clad  ships  and  fortresses.  Industry  supplied  the  govern- 
ment with  weapons  vastly  superior  to  anything  the  primi- 
tive man  had  known,  but  the  victory  still  went  to  those 
who  relatively  excelled  in  men  and  arms.  Iron  and  coal 


THE  LIMITS  IN  GOVERNMENT 

and  chemistry  and  Kartells  came  to  count  as  much  in  an 
international  struggle  as  personal  strength  and  nimbleness 
for  prehistoric  tribes. 

The  economic  man  cultivated  his  powers  of  reasoning, 
but  he  could  not  divest  himself  of  reflex  actions  and  in- 
stincts bred  in  countless  ages  of  ferocious  combat  with 
animals  and  fellowmen.  The  test  for  superiority  changed, 
but  the  instincts  remained  the  same.  Instead  of  foods  the 
desideratum  became  a  surplus  of  capital  goods  with  which 
to  produce  enjoyable  consumption  goods  in  times  of  peace, 
and  weapons  of  defense  in  times  of  war.  In  his  eagerness 
to  acquire  creative  comforts  our  ingenious  man  also  ad- 
vanced the  methods  of  warfare.  His  prosperity  which 
once  turned  on  the  sufficiency  of  food  and  clothing  now 
varied  with  his  possession  of  a  large  stock  of  raw  ma- 
terials and  finished  articles. 

The  social  group  expanded,  but  leadership  became  more 
precarious.  Individual  might  had  to  be  buttressed  more 
and  more  by  the  approval  of  rival  companions.  Prestige 
hinged  on  wealth  because  everybody  valued  wealth  for  its 
own  sake,  besides  desiring  it  as  token  of  providential 
favor  or  of  unusual  ability,  of  privilege  and  power. 
Wealth  meant  leisure  in  peace,  and  victory  in  war.  The 
control  of  riches  in  land  or  in  capital  enabled  man  to 
command  respect  and  obedience  where  the  weight  of  per- 
sonality alone  might  not  have  sufficed.  The  economic 
man,  in  this  sense,  is  an  imperishable  product  of  evolution 
and  progress,  a  fact  all  science  and  sentiment  must  take 
into  account.  While  wealth  has  its  uses  in  war  it  will  be 
doubly  valuable  also  in  days  of  peace. 

But  the  accumulation  of  wealth  rests  largely  with  ex- 
ceptional men.  The  inventors  and  managers  of  capital, 
the  organizers  of  men  for  productive  purposes,  and  the 
proprietors  of  natural  resources  —  these  form  the  nu- 


THE  LIMITS  OF  SOCIALISM 

cleus  from  which  social  growth  must  be  deduced,  just  as 
premises  give  rise  to  a  conclusion.  The  correlations  of 
social  phenomena  are  many,  and  what  is  cause  or  effect 
may  never  be  completely  determinable.  Yet  it  is  certain 
that  without  the  right  sort  of  natural  resources  and  right 
leadership  for  production  or  public  control  nothing  great 
can  be  achieved.  The  place  of  one  nation  among  others 
varies  with  the  use  of  resources  in  material  and  men  made 
by  the  small  minority  now  dominating  business.  When 
a  nation  boasts  many  great  leaders  it  is  likely  to  grow 
rapidly,  to  increase  its  population  by  selling  manufac- 
tures for  foodstuffs,  to  raise  its  level  of  living,  to  widen 
its  horizon  of  thought  and  politics,  and  to  search  the 
world  for  greater  riches. 

If  physical  barriers  do  not  forbid,  an  aggressive  atti- 
tude toward  outsiders  is  thus  sure  to  find  approval.  The 
leaders  want  power  and  empire,  the  masses  demand  com- 
forts and  glory,  i.  e.,  such  glory  as  the  fear  of  rivals  or 
the  consciousness  of  past  triumphs  may  bring.  War,  in 
brief,  is  a  means  of  equilibrating  differentials  of  power  be- 
tween nations  who  rank  as  sovereign  units,  but  whose 
real  might  is  lodged  in  the  hands  of  a  few  who  by  virtue 
of  office  or  of  inborn  superiorities  decide  the  fate  of  the 
multitudes.  It  is  hardly  an  error  to  call  the  leaders  the 
creators  and  destroyers  of  life,  in  that  their  sagacity  and 
energy  alone  provides  the  means  to  an  increase  of  popula- 
tion. But  their  struggle  for  shining  supremacy  also  en- 
gulfs the  masses  periodically  in  bloody  wars,  wars  that 
decimate  the  population  and  redistribute  sovereign  powers 
so  that  another  period  of  growth  for  somebody  may  fol- 
low. 

Differentials  of  national  power  will  always  exist  because 
inventions  change  the  value  of  natural  resources.  What 
at  one  time  means  little,  may  be  highly  prized  and  coveted 


THE  LIMITS  IN  GOVERNMENT  235 

at  another.  In  ancient  days  soil  fertility  was  a  prime 
asset.  To-day  coal  and  iron  stand  out  prominently. 
During  the  later  middle  ages  commerce  with  the  far  east 
helped  nations  to  a  lordly  position.  A  century  hence 
maritime  facilities  may  be  less  significant  than  circum- 
stances favoring  aerial  navigation.  Just  now  oil  and 
copper  are  items  of  maximum  valuation,  but  there  is  no 
gainsaying  that  countries  now  obscure  and  despised  for 
their  backwardness  may  rise  to  eminence  because  of  dis- 
coveries yet  to  be  made  by  now  leading  civilizations.  The 
notion  of  a  balance  of  power  dates  from  days  when  two 
or  three  nations  were  the  arbiters  of  Europe,  but  it  is 
doubtful  whether  it  will  ever  mean  anything  else  than  the 
division  of  power  among  a  few,  whose  policy  is  law  for  all 
others. 

No  nation  is  as  yet  ready  to  renounce  its  sovereign 
rights.  All  nations  have  reserved  for  themselves  the  right 
of  autonomy  in  internal  affairs,  even  if  elsewhere  they  had 
nothing  to  say.  The  spirit  of  nationalism  is  rampant 
these  days.  It  has  been  fed  and  feted  by  the  latest  war, 
instead  of  being  restrained  by  it.  Even  now  nations  are 
preparing  for  rehabilitation  commercially,  for  the  ex- 
pansion of  business  at  the  other's  expense,  for  the  delimi- 
tation of  spheres  of  influence.  Investments  and  colonies, 
mandates  and  protectorates,  alliances  and  tariff  conven- 
tions figure  prominently  in  the  daily  press.  Sovereignty 
is  still  regarded  as  absolute  and  inviolable.  What  kings 
once  claimed  is  now  fitly  ascribed  to  the  people,  but  if 
nationalism  is  to  continue  on  competitive  lines  natural 
differences  will  not  only  be  accentuated,  but  the  motto  of 
particularism  will  estrange  nations  so  that  arbitration  of 
clashing  claims  becomes  difficult. 

Human  nature  gives  us  no  ground  for  expecting  per- 
petual peace  by  the  introduction  of  the  plebiscite  or  of 


236  THE  LIMITS  OF  SOCIALISM 

female  suffrage.  Women  at  all  times  have  supported  men 
in  a  combat.  The  sex  relation  is  so  entirely  mutual  that 
it  is  folly  to  expect  from  women  what  men  cannot  do. 
The  passions  of  the  multitude  are  easily  aroused  to  ungov- 
ernable fury.  Nothing  appeals  like  an  argumentum  ad 
hominem.  If  the  leading  classes  give  moral  support  to  a 
martial  government  it  is  sure  to  find  a  vent.  Patriotism 
covers  a  multitude  of  sins.  Nationalism  is  a  growth  that 
thrives  on  secrecy  and  on  centralization  of  powers.  What 
is  a  domestic  question  and  what  a  justiciable  case,  what  an 
attribute  of  sovereignty  and  what  a  question  for  adjudica- 
tion? What  are  the  obligations  of  a  protectorate  and 
what  the  limits  of  armament  internationally  permitted? 
These  are  problems  not  to  be  solved  with  science  or  law, 
but  with  combats  or  concessions. 

Socialism  has  a  hard  road  to  travel  in  many  respects, 
but  it  is  particularly  embarrassed  in  its  attempts  at  in- 
ternationalism and  enduring  —  we  won't  say  perpetual  — 
peace.  The  safest  preventives  at  its  disposal  are  educa- 
tion and  publicity,  decentralization  of  economic  powers, 
and  a  leveling  of  incomes.  If  by  equalization  of  oppor- 
tunities and  economic  rights  we  can  teach  the  average  man 
to  think ;  if  in  the  wake  of  enlightenment  morality  will 
gradually  subordinate  feelings  of  race  and  nationality  to 
the  concept  of  humanity ;  if  in  giving  the  masses  an  active 
share  in  government  we  can  banish  camarillas  of  Machia- 
vellianism, bringing  into  the  light  of  day  the  precise  facts 
at  issue  —  then  we  may  hope  to  chain  grim  Mars  and 
smooth  the  path  for  Peace.  But  socialism  has  not  yet  de- 
clared itself  willing  or  able  to  redistribute  the  world's 
goods  irrespective  of  national  boundaries;  nor  are  the 
means  near  at  hand  that  make  such  an  equalization  of  re- 
sources and  policies  possible.  Tried  in  only  one  or  two 


THE  LIMITS  IN  GOVERNMENT  237 

countries  socialism  might  meet  the  fate  of  bi-metallism 
which  could  not  hold  itself  in  the  midst  of  gold  standards. 
To  conclude.  The  weaker  system  of  production,  if 
international  trade  is  to  follow  competitive  principles,  is 
assuredly  the  socialistic.  Costs  can  be  lowered  if  we  have 
no  conscience.  Markets  may  be  conquered  at  the  sacri- 
fice of  millions  at  home,  provided  the  law  does  not  inter- 
fere. Socialism  will  value  personality  above  product.  It 
may  raise  the  social  dividend  without  cheapening  particu- 
lar types  of  goods  fit  for  exportation.  It  might  be  com- 
pelled to  buy  imports  at  prices  costly  to  the  consumer. 
In  rich  countries  socialism  will  tend  to  lower  levels  of  liv- 
ing if  it  wishes  to  aid  poorer  countries.  The  gain  will 
come  some  day,  if  all  cooperate  on  one  principle,  but  for 
the  present  the  outlook  for  internationalism  is  disquieting. 
The  limits  of  government  point  to  nationalism  in  spite  of 
its  perils,  in  spite  of  grievous  experiences  in  the  past. 


CHAPTER  X 
A  PETITION 

§  i.  Foundations  in  Social  Science  Restated. —  What 
has  so  far  been  said  should  now  enable  us  to  summarize  as 
follows : 

Social  reform  manifestly  must  be  based  on  social  sci- 
%ence.  The  physician  in  this  respect  sets  a  good  example 
to  the  socialist  and  to  other  prophets  of  a  better  world. 
He  does  not  suggest  cures  until  he  has  analyzed  his  case. 
Diagnosis  and  prognosis  go  together.  What  is  more,  a 
careful  record  of  the  course  of  the  malady  is  kept,  and 
only  in  the  light  of  past  experiences,  which  are  compared 
with  the  individual  case,  is  treatment  offered.  The  phy- 
sician relies  upon  the  facts  of  physiology  and  allied  sci- 
ences for  his  power  of  aiding  the  sick. 

The  would-be  healer  of  social  ills  can  do  no  better  than 
look  to  the  foundations  of  social  processes  before  going  to 
work.  The  data  of  biology  and  psychology,  of  sociology 
and  of  economics  furnish  the  light  by  which  eventually  a 
prescription  may  be  filled  for  the  curing  of  social  patients. 
The  diagnosis  may  not  be  perfect.  The  symptoms  may 
mislead  us.  The  issue  of  the  disease  may  be  most  un- 
expected. But  in  spite  of  the  limitations  to  which  all 
science  is  subject,  and  which  the  reformer  must  bear  in 
mind,  his  plans  have  a  chance  of  success  only  in  so  far  as 
they  square  with  actualities.  Whether  we  are  dealing 
with  a  political  platform,  or  with  a  petition  of  rights  for 
the  people,  each  must  be  based  on  facts,  and  accept  the 

restraints  which  facts  impose. 

238 


A  PETITION  239 

For  purposes  of  reform  as  well  as  for  research  in  gen- 
eral the  empirical  standpoint  alone  can  satisfy.  There  is 
no  gain  in  postulating  sources  of  truth  which  lie  beyond 
the  ken  of  our  senses.  To  predicate  innate  ideas  about 
anything  is  useless,  for  the  predication  itself  is  not  innate, 
and  if  it  were  it  could  not  change  the  nature  of  our  know- 
ing. The  distinction  between  things  and  things-in-them- 
selves  is  entirely  gratuitous.  It  is  useless  except  to  call 
our  attention  to  the  sources  of  our  knowledge  and  to  the 
methods  we  employ  in  reasoning. 

There  is  no  way  of  learning  except  by  our  power  of 
sensing  things,  by  our  ability  to  respond  selectively  to, 
and  to  remember,  the  stimuli  acting  from  without  and 
from  within.  Our  senses  furnish  the  basis  for  knowledge. 
The  data  of  our  consciousness  and  its  reactions  measure 
the  scope  of  our  learning.  We  receive  stimulations  and 
respond  in  certain  ways.  We  remember  and  construct 
associations  which  according  to  purpose  and  setting  ter- 
minate in  action,  or  perhaps  do  not. 

The  outside  world  is  one  of  regularities  because  of  our 
ability  to  perceive,  select,  and  remember.  Associations 
alone  make  possible  the  connections  by  which  we  bring  or- 
der into  chaos.  It  is  through  inference  by  enumeration 
and  by  comparison  of  resemblances  and  differences  that 
we  obtain  classes  of  things  and  laws  of  nature.  The  laws 
that  science  speaks  of  are  sequences  and  coexistences  re- 
curring with  different  degrees  of  regularity.  We  can 
control  them  in  a  measure.  We  can  modify  some  of  the 
laws,  but  only  by  changing  ourselves.  Everything  for 
that  matter  is  subject  to  change.  Nothing  is  absolutely 
rigid  or  definitive.  The  groups  of  events  which  we  bind 
together  and  experience  as  correlatives  or  laws  change  in 
scope  and  contents.  As  students  we  add  to,  and  subtract 
from,  such  facts  involved  in  a  given  situation  according 


240  THE  LIMITS  OF  SOCIALISM 

to  time  and  circumstance.  From  time  to  time  all  our 
knowledge  must  be  restated.  Its  values  have  undergone  a 
change  without  our  at  first  being  conscious  of  it.  Thus 
sciences  grow,  and  in  this  sense  all  sciences  are  inter- 
related, the  boundary  lines  shifting  and  becoming  clear 
and  blurred  by  turns. 

But  our  knowledge  is  also  relative  in  this  respect  that 
not  all  people  judge  facts  alike.  They  have  many  char- 
acteristics in  common,  but  in  different  degrees.  Our 
anatomy,  for  instance,  is  substantially  the  same  for  all. 
In  instincts  tending  to  survival  we  are  much  alike.  Our 
sense  perceptions  in  general  correspond  so  that  we  all  see 
or  hear  the  objects  or  noises  about  us.  •  But  increasingly, 
as  we  move  away  from  the  most  fundamental  traits  of 
human  nature,  we  notice  differences  in  men,  in  their  inter- 
ests and  methods  of  valuation.  /  The  number  and  the  sig- 
nificance of  factors  in  a  given  situation  appear  differently 
to  different  people.  The  events  may  be  called  variables 
whose  functioning  is  the  subject  of  science.  The  fact  of 
interrelation  is  observed  by  all,  and  will  be  agreed  to  from 
the  start,  but  its  nature  or  functioning  challenges  the 
acumen  of  the  ablest,  indeed  cannot  often  be  established 
indisputably. 

The  variables  of  events,  or  experiences  that  fill  our  life 
and  become  the  special  concern  of  scientists,  are  all  either 
causes  or  effects  according  to  viewpoint  and  needs  of  the 
moment.  It  is  not  that  the  two  are  generically  distinct, 
but  that  some  factors  in  a  situation  are  considered  as 
constants,  relative  to  which  all  others  are  treated  as  vari- 
ables. We  understand  things  by  cross  reference.  We 
explain  the  obscure  by  comparing  it  with  the  clear,  or 
what  seems  clear.  We  select  our  subjects  for  observation, 
and  by  focussing  our  attention  upon  particulars  get  the 
truth  which  at  the  time  is  sought.  Purposes  and  circum- 


A  PETITION 

stances  govern  all  our  searches  for  law  in  nature  and  for 
rule  in  personal  conduct  or  social  policy. 

It  follows  then  that  sciences  are  not  only  intercon- 
nected, but  also  that  for  all  sciences  there  is  but  one 
method.  The  man  on  the  street  who  is  not  specially 
trained  will  yet,  in  the  main,  use  the  modes  of  reasoning 
employed  by  the  professional  student.  The  two  stand  in 
this  respect  on  a  level  because  both  are  products  of  one 
course  of  evolution.  Just  as  man  is  a  unit  and  therefore 
all  social  phenomena  interrelated,  so  scientific  and  un- 
scientific methods  of  thinking  have  much  in  common. 
The  chief  difference  between  the  untutored  man  and  the 
scientist  is  the  latter's  enlarged  fund  of  associations  which 
permits  him  to  extend  greatly  his  comparisons  and  test 
thoroughly  his  inferences  by  enumeration  and  analogy. 
He  practices  a  more  careful  selection  of  data,  makes  ex- 
acter  measurements  thanks  to  the  use  of  instruments  not 
possessed  by  the  layman,  and  hence,  as  final  result,  boasts 
a  wider  scope  of  investigation  and  of  generalization.  The 
scientist  stands  on  a  higher  plane  because  he  excels  in 
association  and  measurement.  The  scientist  does  not  al- 
low himself  to  be  hindered  by  irrelevant  premises.  He 
assumes  only  the  will  to  live.  That  given,  his  world  of 
experience  and  truth  is  mechanistically  pictured  or  at  any 
rate  understood. 

Science  is  necessarily  mechanistic.  But  this  does  not 
prevent  it  from  accepting  that  viewpoint  as  correct  which 
makes  man  appear  self-directing  and  responsible  accord- 
ing to  socially  instituted  standards.  The  notion  of  free- 
will is  no  impediment  to  the  scientist.  He  may  grant  it, 
and  then  pursue  his  studies  as  though  it  did  not  exist. 
Freewill  is  a  way  of  looking  at  the  outside  world  from 
within.  It  is  an  egotistic  norm  of  valuation.  It  enables 
us  to  refer  events  to  ourselves,  or  one  part  of  a  situation 


THE  LIMITS  OF  SOCIALISM 

to  another.  In  social  sciences  notably  the  assumption  of 
a  freewill  is  a  prospective  way  of  viewing  plans  of  action, 
i.  e.,  coming  events.  There  is  no  objection  to  considering 
each  man  the  maker  of  his  own  fortune,  as  though 
he  were  lord  over  his  Self  and  the  fashioner  of  his  des- 
tinies. But  statistics  show  that  events,  though  sup- 
posedly willed,  happen  with  considerable  regularity,  and 
that  what  a  man  really  does  is  far  different  from  the 
things  he  believes  he  could  do  if  necessary.  A  belief  in 
illimitable  will  is  usually  a  picturing  of  possibilities  with 
the  aid  of  the  imagination.  Associations  outstrip  action ! 

Similarly  science  does  not  conflict  with  ethics  or  re- 
ligion. The  latter  two  may  be  deemed  independent  fields 
for  investigation  if  it's  found  profitable,  but  the  evidence 
of  natural  and  social  sciences  favors  the  subordination  of 
moral  norms  to  the  general  scheme  of  consciousness  and 
sociation.  What  we  think  right,  and  what  we  wish  of  an 
unknown  future,  these  are  facts  that  are  an  integral  part 
of  our  whole  being.  There  is  no  method  for  understand- 
ing the  Ought  and  the  Soul  except  by  analyzing  self  and 
society  as  the  scientist  is  wont  to. 

If  we  apply  some  of  these  fundamentals  to  social  sci- 
ence we  shall  find  at  once  the  limits  of  all  social  movements 
and  of  all  reform  schemes.  No  one  can  work  without  the 
right  basis  for  physical  reactions.  No  one  can  excogitate 
a  world  entirely  apart  from  his  surroundings.  No  one 
will  propose  betterments,  except  he  is  bound  by  the  tra- 
ditions back  of  him  and  by  the  shortcomings  of  science  as 
they  exist  at  his  time.  All  social  events  are  conceived  as 
knit  together.  The  relations  are  intimate  or  remote,  but 
they  may  be  proven  to  exist  if  we  trace  events  far  enough. 
Yet  for  the  same  reason  all  truths  are  relative  to  time, 
place,  and  circumstance,  or  to  put  it  more  accurately,  to 
place,  period,  and  people.  It  is  the  environment  in  gen- 


A  PETITION  243 

eral  and  particular,  it  is  the  epoch  of  social  development 
or  of  national  growth,  it  is  the  group  experiencing  the 
events,  be  it  large  or  small  —  it  is  in  the  midst  of  these 
facts  that  all  social  principles  find  their  bounds.  There 
are  too  many  variables  to  permit  an  exhaustive  interpre- 
tation. There  are  many  events  functioning  as  variables, 
because  human  nature  is  so  much  more  complex  than  either 
animal  or  plant,  or  than  any  of  the  relations  of  the  in- 
organic world. 

On  the  other  hand,  the  main  facts  of  human  nature  are 
definitely  ascertainable  and  virtually  immutable.  The 
changes  in  man  come  so  slowly  that  we  can  scarcely  per- 
ceive them.  To  ourselves  we  are  the  constant  by  refer- 
ence to  which  the  events  about  us  appear  as  variables 
which,  more  or  less  completely,  we  may  control.  Human 
nature  is  practically  a  constant,  though  per  individual 
the  force  of  variation  is  as  great  as  that  of  heredity  is 
self  evident. 

Precisely  because  of  this  substantial  definiteness  of  our 
make-up  the  data  of  psychology  and  of  biology  furnish 
us  a  clue  to  standards  of  prosperity.  A  theory  of  pros- 
perity depends  on  the  knowledge  of  those  two  sciences. 
The  principles  of  sociology  and  of  economics  are  the  last 
auxiliaries  toward  a  science  of  social  welfare  which  poli- 
tics should  apply.  But  the  social  sciences  cannot  go 
ahead  until  the  more  fundamental  inquiries  have  attained 
a  certain  mastery  of  facts.  Psychology,  because  it 
studies  the  individual,  serves  to  clarify  our  notions  of 
reasoning,  and  because  it  is  basic  to  social  studies,  it  may 
serve  also  to  help  formulate  our  norms  of  right  and  wrong. 
Right  and  wrong  are  criteria  of  social  origin  whose  indi- 
vidual aspects  are  treated  by  psychology. 

Without  the  combined  action  of  natural  and  social  sci- 
ence, then,  we  cannot  hope  to  arrive  at  clear  ideas  of 


244  THE  LIMITS  OF  SOCIALISM 

prosperity  or  of  reform.  Socialism  was  among  the  first 
movements  for  betterment  to  recognize  this  cardinal  fact. 
Hence,  if  for  no  other  reason,  it  deserves  a  conspicuous 
place  in  the  history  of  human  thought.  But,  indeed, 
socialism  has  a  mission  for  other  reasons  still.  It  is  not 
only  the  logical  continuation  of  doctrines  first  enunciated 
by  Comte  the  Positivist  and  Mill  the  Utilitarian,  but  in 
addition  it  broached  for  the  first  time  in  unmistakable 
tones  the  relation  of  economics  to  non-economics,  or,  as 
we  might  say,  of  wealth  to  weal. 

§  2.  Errors  in  Socialism. —  Socialists  committed  mis- 
takes in  action,  and  they  espoused  for  a  long  time  (in 
part  still  espouse)  teachings  not  tenable  in  the  light  of 
current  science.  Socialism,  for  instance,  was  wrong  in 
promising  to  eliminate  all  maladjustment  and  give  to  men 
a  millennium.  It  was  wrong  in  declaring  conditions  of 
production  and  of  exchange  to  be  causative  of  all  other 
facts  of  sociation,  as  though  one  was  the  maker  of  the 
other.  It  will  not  help  us,  as  we  have  seen,  to  trace  a  chain 
of  events  in  one  direction  only.  The  relation  of  events 
would  be  warped.  It  is  not  a  question  of  economic  man 
building  all  the  rest  in  man,  but  one  of  lines  of  thought  and 
action  radiating  from  one  center.  Man  is  a  single  whole, 
and  all  life's  experiences  must  be  interlaced  as  a  result  of  it. 
Without  this  conception  life  becomes  a  mystery,  or  else  a 
mere  catalogue  of  facts  as  meaningless  as  the  variegation 
of  a  kaleidoscope. 

Socialism  furthermore  erred  in  attributing  all  values  to 
one  factor,  and  particularly  in  comparing  effort-in-time 
with  the  market  values  of  a  competitive  regime.  Prices 
are  not  measured  by  labor  except  in  a  very  general  way, 
and  what  is  more  important :  Prices  cannot  in  this  way 
be  identified  with  incomes.  Socialism,  by  the  same  token, 
failed  in  trying  to  correlate  prices  of  goods  with  personal 


A  PETITION  245 

incomes,  or  even  with  factorial  incomes.  We  can  some- 
times impute  values  to  each  one  of  many  elements  con- 
tributing toward  a  single  product.  The  physicist  does 
it,  and  other  sciences  may  do  the  same.  But  in  the  realm 
of  exchange  the  imputation  is  indirect  and  can  lead  to  no 
nice  measurements.  To  declare  labor  an  essential  in  pro- 
duction is  one  thing,  and  to  measure  wants  by  work  is 
another  thing.  The  socialist  aimed  at  the  wrong  thing, 
to  begin  with,  when  he  proposed  to  explain  incomes  by 
prices,  and  he  failed  again  because,  having  set  his  target, 
he  did  not  aim  well. 

The  founders  of  socialism  similarly  erred  in  expecting 
everything  good  from  the  abolition  of  capitalism,  for  pri- 
vate ownership  of  the  means  of  production  and  of  ex- 
change does  not  explain  all  evils.  They  were  proven  false 
prophets  also  by  future  events,  for  misery,  while  it  has 
perhaps  not  abated  a  great  deal,  has  certainly  not  in- 
creased to  the  degree  that  was  apprehended.  The  Marx- 
ian theory  of  misery  contains  an  element  of  truth,  but  it 
can  be  found  only  in  Marx's  "  Economic  Interpretation  of 
History,"  and  there  it  is  marred  by  the  fond  belief  that 
nationalization  of  capital  would  remove  all  evils. 

Lastly,  socialists  laid  themselves  open  to  charges  when 
they  promised  the  world  a  much  higher  level  of  living  than 
is  now  assured  to  the  bulk  of  the  people.  They  expect 
a  gain  in  productiveness,  thanks  to  the  abolition  of  private 
capitalism,  which  cannot  be  logically  deduced  from  the 
facts  of  population  and  environment,  nor  agrees  with 
socialistic  ideals  of  self  development.  The  limits  in  race 
improvement  are  also  much  in  evidence,  whether  we  appeal 
to  our  own  powers  of  observation  or  to  the  verdict  of  sci- 
ence. Everywhere  we  find  bounds  prescribed  that  social- 
ism has  often  overlooked,  or  promised  to  set  at  nought  by 
the  application  of  one  general  principle,  to  wit  the  aboli- 


246  THE  LIMITS  OF  SOCIALISM 

tion  of  private  property.  But  such  optimism  is  never 
fruitful.  It  can  only  prompt  some  people  to  misunder- 
stand the  nature  of  democracy  and  to  look  forward  to 
change  such  as  science  knows  nothing  of.  Democracy  is 
more  than  a  distributive  norm,  and  less  than  a  complete 
equalization  of  governors  and  the  governed.  The  same 
differences  among  men  that  prevent  us  from  fixing  a  ratio 
between  property  and  personality,  or  between  economic 
income  and  psychic  outgo,  also  point  to  limits  in  govern- 
ment, no  matter  how  liberally  we  scatter  rights  of  voting 
and  of  office  holding. 

§  3.  Merits  in  the  Viewpoint  of  Socialism —  Social- 
ism, then,  may  be  criticized  from  many  standpoints,  since 
its  premises  and  conclusions  partly  belong  to  a  period 
which  science  has  left  far  behind.  But  as  against  these 
blanks  we  must  note,  too,  the  winning  numbers  in  the 
game.  The  founders  of  socialism  have  conferred  great 
benefits  upon  us,  because  they  were  exceptional  men  who 
saw  far  and  gathered  wisdom  from  many  founts.  It 
would  be  strange  if  they  had  not  discovered  new  truths 
in  all  their  quest  for  betterment,  or  failed  to  enhance  the 
value  of  old  truths.  Men  like  Marx  and  Engels  or  Las- 
salle  will  always  prove  a  boon  to  society,  for  any  deter- 
mined defense  of  scientific  endeavor  leads  to  moral  as  well 
as  to  intellectual  regeneration. 

Socialism  was  right  in  adopting  an  empirical  position, 
in  emancipating  itself  from  all  hankerings  for  a  transcen- 
dental universe.  Socialists  were  among  the  first  to  preach 
relativism  and  to  apply  the  principle  of  instability  to 
human  history.  The  evolution  of  our  thoughts  and  ac- 
tions was  shown  to  be  a  law  pervading  our  whole  social  de- 
velopment. The  dual  aspect  of  eternal  truth  was  revealed 
sharply.  Thus  dogmatism  was  dealt  a  severe  blow,  the 


A  PETITION  247 

absolutism  of  Hegel  becoming  a  brief  on  behalf  of  the 
masses. 

Socialism  is  right  in  correlating  science  and  reform: 
It  was  the  earliest  of  the  great  movements  for  reform  on 
a  purely  scientific  basis.  True,  to  divorce  science  from 
sentiment  is  not  always  possible,  nor  will  all  agree  to  its 
being  a  lofty  ideal.  It  is  much  the  same  thing  when  art 
and  morality  are  coupled.  Some  object,  and  others  ap- 
plaud. But  it  is  important  for  the  reformer  that  he  curb 
his  desires  in  accordance  with  scientifically  established 
limits,  and  this  the  socialists  sought  first  to  do.  They 
hoped  for  betterment  through  the  workings  of  a  cosmic 
law.  They  argued  for  sweeping  changes  and  at  times 
took  refuge  in  rebellion  and  hyperboles  of  speech.  But 
on  the  other  hand  they  did  not  demand  redress  merely 
because  their  conscience  drove  them,  or  because  somebody 
urged  them  to  protect  the  weak.  ^The  chief  principle  from 
the  outset  was  the  connecting  of  revolution  with  evolu- 
tion. J) 

This  likewise  enabled  the  founders  of  socialism  to  in- 
corporate ethics  with  economics.  The  socialistic  theory 
of  prosperity  harmonizes  with  modern  science  in  that  it 
insists  upon  verification.  The  proof  of  conduct  is  held 
superior  to  protestations  of  creed.  Whenever  this  is 
done,  whenever  service  is  placed  above  suffering  the  road 
is  opened  for  progress.  By  objective  tests  the  good  and 
the  bad  should  be  defined.  This  socialism  has  aimed  to  do 
from  the  start.  Ethics  was  recognized  as  part  of  social 
science.  The  empirical,  or  if  you  will,  the  pragmatic 
viewpoint  was  thus  given  a  specific  meaning  that  all  could 
understand  and  criticize  as  they  pleased. 

The  socialization  of  religion  is  a  by-product  of  this 
mode  of  reasoning.  Socialists  have  always  championed 


248  THE  LIMITS  OF  SOCIALISM 

the  Golden  Rule  as  the  quintessence  of  holy  communion. 
They  have  stood  by  those  who  brought  religion  to  earth 
and  gave  it  a  social  mission.  That  ideals  are  of  the  earth 
and  yet  may  rise  above  the  earthy,  this  is  the  stand  taken 
by  the  positivists,  and  this  attitude  socialism  has  con- 
sistently supported. 

But  socialism  was  also  right  in  stressing  the  social  roots 
of  evil.  The  older  thought  that  man  fell  from  grace  or 
that  nature  was  to  blame  if  people  lived  in  pain  and  pov- 
erty was  calculated  to  encourage  pessimism.  It  drove 
men  to  despair  and  granted  an  easy  sinecure  to  privileged 
classes.  Compared  to  this  soothing  sirup  the  socialistic 
medicine  had  real  merit  and  promised  a  cure.  It  agreed 
with  the  gospel  of  prosperity  which  science  now  is  inter- 
ested in,  and  called  attention  to  the  predominance  of  the 
instincts  over  our  habits  of  reasoning.  That  man  was 
first  an  animal  and  next  a  being  of  reason  was  always  ad- 
mitted by  socialists.  The  economic  interpretation  means 
partly  this.  But  it  also  hints  at  the  possibilities  for  self 
development.  Reason  enthroned  is  as  true  a  symbol  for 
socialism  as  the  tiger  stalking  for  prey.  The  balancing 
of  primordial  selfishness  with  socialized  altruism,  this  is 
the  task  of  the  future,  and  to  this  task  socialists  have 
ever  bent  their  energy. 

Socialism  is  not  averse  to  recognizing  the  beast  in  man. 
The  veneer  of  civilization  fools  least  of  all  the  socialist. 
But  for  all  that  he  has  declined  to  subscribe  to  the  teach- 
ings of  competitive  economics.  The  founders  of  socialism 
were  pioneers  in  social  science  and  advanced  critics  of  the 
classical  system  which  made  a  fetich  of  individualism. 
They  did  well  in  exposing  the  logical  consequences  of 
Ricardianism,  and  they  made  some  contributions  to  the 
critique  of  marginal  economics  which  until  recently  held 
almost  undisputed  sway.  A  stress  on  collectivism  may 


A  PETITION  249 

lead  to  extravagant,  pyppctatjons^  An  exclusive  reliance 
on  state  ownership  will  disappoint  its  sincerest  friends. 
But  that  evils  exist  and  reforms  are  needed  no  one  will 
deny.  Yet  it  was  socialism  which  first  systematized  the 
business  of  meliorism  and  opened  our  eyes  to  the  signifi- 
cance of  private  property.  To  take  nothing  for  granted 
is  a  sound  maxim  in  science.  Socialists  learned  it  early. 
They  did  not  take  private  property,  e.  g.,  for  granted. 
We  can  do  no  better  than  follow  in  their  footsteps  and 
search  into  the  grounds  of  an  institution  which  exercises 
such  an  incalculable  influence  over  our  weal  and  woe. 

§  4.  Existing  Evils  in  Our  Economic  System. —  Re- 
form undoubtedly  is  needed.  Evils  exist  in  plenty,  and 
not  all  of  them  are  necessary  even  at  this  stage  of  social 
development.  We  may  agree  to  the  old  saw  that  nothing 
is  perfect  and  yet  apply  ourselves  with  zest  to  the  task  of 
bettering  socio-economic  conditions. 

The  evils  are  known  to  all  and  need  no  lengthy  discus- 
sion. We  have  among  us  the  diseased  and  the  cripples, 
the  subnormal  in  mind  and  the  totally  disabled.  We  have 
criminals  of  many  types  and  vice  that  goes  unpunished  by 
law.  There  is  cruel  hunger  that  cannot  be  stilled,  and 
y  pauperism  no  philanthropist  can  root  out.  Some  over- 
^work  or  suffer  from  the  effectsToT "exxfessive^specialization. 
Others  again  are  treated  unfairly  in  a  personal  way  and 
resent  the  insults  thrust  at  them.  We  know  of  many 
who  are  kept  unfit  for  civic  duties,  who  cannot  be  made 
desirable  members  of  a  democratically  governed  country. 
Class  struggle  is  real,  and  discontent  widespread. 

All  these  evils  have  existed  for  centuries  and  in  part 
cannot  be  removed.  It  is  not  possible  for  instance  to  en- 
sure everybody  good  health  by  safeguarding  him  when  at 
work,  or  by  scientific  sanitary  engineering.  Gluttony  and 
bad  habits  are  as  common  a  source  of  illness  as  accidents 


250  THE  LIMITS  OF  SOCIALISM 

or  bad  housing  conditions.  The  congenitally  disfigured 
and  disabled  we  shall  perhaps  have  always  with  us,  for  the 
problems  of  genetics  have  not  yet  suggested  ways  and 
means  for  controlling  natural  variations.  The  blind  and 
the  deaf  and  dumb  are  a  burden  that  society  must  shoulder 
with  resignation.  The  demented  or  the  moron,  that  aris- 
tocrat of  the  feeble-minded,  may  be  helped  by  trained 
guardians,  but  they  will  for  long  times  to  come  form  a 
certain  percentage  of  our  population.  And  so  with  the 
rest  of  the  shortcomings.  Not  all  crime  is  traceable  to 
social  surroundings.  There  is  some  evidence  to  show  that 
born  criminals  exist,  and  that  vicious  habits  may  be  in- 
herited as  well  as  acquired  in  unobtrusive  ways. 

Among  the  rich,  too,  there  is  much  profligacy  and  bar- 
renness, both  of  the  physical  and  the  intellectual  kind. 
Money  rules  not  uncommonly  at  the  expense  of  mentality 
and  manhood.  The  reign  of  money  is  plutocracy,  whose 
undesirable  features  have  been  sufficiently  explained. 
Even  in  a  political  democracy  the  money-king  has  some 
power.  And  power  breeds  arrogance,  and  arrogance 
leads  to  friction  and  class  consciousness.  Idleness  is  the 
fruit  of  wealth  as  well  as  of  inherited  lethargy.  Too 
many  nowadays  prosper  in  languor,  supinely  enjoying  ill- 
gotten  gains.  Complacency  and  egoism  flourish  among 
the  rich  who  control  a  large  portion  of  the  national  in- 
come. Extreme  concentration  of  income  is  as  obnoxious 
from  the  standpoint  of  comradeship  and  solidarity  of  in- 
terests as  it  may  seem  unjust  to  the  defenders  of  a  high 
material  level  of  living.  It  is  in  the  competitive  regime 
as  heretofore  prevailing  that  unearned  increments  enrich 
the  one,  while  hard  laborers  are  rewarded  insufficiently. 
The  unearned  portion  crops  out  at  all  sorts  of  places. 
We  see  it  in  the  appreciations  of  natural  resources,  of  real 
estate,  in  the  winnings  of  the  profiteer  and  stock  broker, 


A  PETITION  351 

in  the  scoop  made  by  the  keeper  of  roulette  tables,  in 
rentals  squeezed  out  of  the  toiler's  weekly  pittance,  in 
usury  rates  levied  by  the  small  capitalist,  in  the  collection 
of  royalties  and  patent  rights,  in  gifts  and  briberies  re- 
ceived by  young  and  old,  with  or  without  their  under- 
standing of  the  evils  involved. 

A  further  result  of  past  competitive  practices  has  been 
an  absurd  valuation  of  goods  and  a  disproportionate  out- 
put of  luxuries,  considering  the  needs  of  the  great  ma- 
jority. The  lawyer,  for  instance,  who  helps  his  client  in 
the  criminal  circumvention  of  the  statutes  enacted  in  de- 
fense of  the  consumer  is  repaid  richly  for  his  effort.  A 
princely  retainer-fee  perhaps  is  his  share  of  the  bargain. 
He  has,  for  his  purposes,  made  good  use  of  his  position. 
Pandects  and  precedents  at  court  have  to  him  been  not 
merely  a  mine  of  information,  but  also  of  gold  which 
many  others,  covetous  of  success,  will  envy  him.  The 
farmer  on  the  contrary,  who  with  his  toil  produces  the  es- 
sentials wherewith  to  feed  his  nation,  is  fortunate  if  he 
makes  a  living.  Indeed,  not  infrequently  he  had  less  than 
a  standard  wage.  Again,  trivial  personal  services  ren- 
dered to  the  wealthy  bring  a  magnificent  largess,  while  the 
most  deserving  must  get  along  in  beggarly  fashion.  The 
businessman  knows  how  to  cater  to  the  rich  and  glean  from 
their  table  many  a  crumb.  The  lowly  are  naturally  in- 
clined to  make  the  most  of  an  anomalous  situation.  They 
cannot  change  the  economic  order,  so  the  best  thing  is 
servile  adaptation,  a  regard  for  the  wishes  of  those  that 
have,  so  they  themselves  may  pocket  some  gains.  For 
ridiculous  services  exorbitant  prices,  and  with  the  price  a 
shower  of  tips  even  more  generous ! 

Gross  inequality  in  the  distribution  of  incomes  has  thus 

led  to  pompous  displays  on  the  one  hand,   and  to   sad 

\     wants   on   the   other.     The   contrasts   of   rich   and   poor 


252  THE  LIMITS  OF  SOCIALISM 

evoke  dismay  and  wonder. V  It  is  what  the  masses  do  not 
get  rather  than  what  the  opulent  display  that  impresses 
one.  One  sees  what  progress  so  far  has  not  accom- 
plished. Crowded  and  filthy  tenements  not  only  repel 
those  of  cleanly  habits,  they  also  are  an  indictment  for 
those  who  by  their  extravagances  turn  labor  into  wrong 
channels.  The  regalia  of  West  End  cannot  make  us  for- 
get the  ragamuffins  of  East  End.  The  fascinations  of 
Fifth  Avenue  relieve  in  no  wise  the  squalor  a  few  blocks 
away.  Slums  are  an  evil,  whether  we  live  in  them  our- 
selves or  not. 

The  time  for  a  thorough  study  of  social  processes  is 
now.  Now  is  the  time  to  think  and  act  on  matters  socio- 
logical. These  are  the  days  when  reform  must  interest 
alert  men  and  women.  The  European  upheaval  is  an  in- 
stance both  of  evils  fatally  ignored  and  of  experiments 
in  social  regeneration.  Circumstances  alter  cases.  A 
readjustment  to  conditions  precipitated  by  the  war  is  im- 
pending. Whether  all  of  the  changes  now  advocated  will 
meet  the  test  of  time  no  one  can  tell,  but  that  betterments 
are  under  way  should  be  manifest  to  all.  The  Old  World 
is  rapidly  becoming  a  new  world. 

The  United  States,  too,  is  in  a  favorable  position  for  a 
retesting  of  social  norms.  It  represents  the  largest  block 
of  natural  resources  ever  placed  under  one  flag.  No  other 
belt  on  this  globe  of  ours  equals  it  in  richness  or  in  the 
efficiency  of  its  population.  We  have  minerals  and  water- 
power,  timber  lands  and  vast  plains  yielding  bountiful 
harvests.  We  have  untold  wealth  aiding  us  in  production, 
a  high  level  of  living  that  may  still  be  raised  higher  by 
right  methods,  and  a  stock  of  people  whose  full  capacities 
have  not  yet  been  put  to  a  trial.  With  so  much  to  act 
on,  with  such  assets  to  manage  for  the  best  of  all,  the 
cause  of  social  science  should  not  be  deserted.  A  disin- 


A  PETITION  253 

terested  but  wholehearted  application  of  knowledge  can 
nowhere  bring  richer  rewards. 

The  socialist  addresses  himself  in  this  spirit  to  all 
classes  of  people.  Not  merely  to  the  professional  stu- 
dent or  to  statesmen,  but  to  all  workers,  and  in  particu- 
lar to  the  average  wage  earner  who  has  most  at  stake  in 
this  movement  for  a  redress  of  wrongs.  Without  definite 
knowledge  nothing  can  be  achieved.  Without  the  goodwill 
of  the  majority  no  public  action  can  be  taken.  Without 
enthusiasm  no  sustained  effort  is  likely.  But  if  in  the 
future  the  average  man  applies  himself  diligently  to  prob- 
lems of  social  welfare  extraordinary  achievements  are  in 
store  for  us. 

§  5.  A  Petition. —  A  petition  for  redress  of  existing 
evils  rests  on  this  assumption.  It  takes  for  granted  that 
the  data  of  social  science  are  duly  consulted,  and  that 
only  a  joint  effort  of  all  can  net  lasting  benefits.  This 
is  the  characteristic  of  a  theory  of  prosperity  weaned 
from  the  conceits  of  bygone  centuries. 

The  socialist,  and  with  him  the  student  of  social  pro- 
cesses, pleads  for  equalization  of  rights  and  duties  every- 
where so  far  as  the  norms  of  maximum  welfare  permit. 
We  must  equalize  —  that  is  make  less  uneven  —  the  dis- 
tribution of  income  by  virtual,  if  not  actual,  abolition  of 
the  right  of  inheritance,  by  taxation,  and  by  increasing 
the  public  ownership  of  industrial  plants  and  of  natural 
resources.  Inheritance,  as  J.  S.  Mill  acknowledged  in  his 
"  Principles  of  Political  Economy,"  is  no  logical  adjunct 
of  private  property.  Its  praiseworthy  features  are  few, 
but  its  demerits  stand  out  boldly. 

Taxes  also  may  be  revised  so  as  to  conform  to  a  collectiv- 
istic  rather  than  to  an  individualistic  standard.  In  the 
past  the  faculty  theory  of  taxation  took  for  granted 
what  socialism  denied.  Tax  rates  were  meant  to  rectify 


254  THE  LIMITS  OF  SOCIALISM 

errors  of  ruthless  competition,  but  the  roots  of  the  evil 
were  not  thereby  disturbed.  To  tax  the  financially  able 
means  to  define  ability  to  earn  as  well  as  ability  to  pay 
taxes.  This  is  the  consideration  which  should  govern  us 
from  now  on.  In  this  way  distributive  justice  may  be 
more  nearly  achieved  than  at  present.  But  greatly  in- 
creased taxes  necessitate  extension  of  government  func- 
tions. Both  local  and  central  agencies  will  find  more  to 
do,  and  try  to  solve  problems  increasingly  by  appropri- 
ating the  visible  means  of  production.  Equalization  of 
income  thus  means  eventually  a  restriction  of  private 
property  as  well  as  a  revelation  of  services.  Sumptuary 
laws  may  also  help  in  equalizing  incomes,  but  the  greatest 
power  for  good  at  all  times  is  education.  Socialists 
therefore  insist  upon  the  universalization  of  enlighten- 
ment, and  our  friends  of  reform,  whether  socialistic  or 
otherwise,  will  support  this  view.  Education  is  the 
means  of  social  advancement.  More  education,  and  edu- 
cation for  more  people.  Both  are  needed.  Education 
should  be  made  compulsory  and  free.  It  should  be  open 
to  all  regardless  of  wealth  or  parentage  or  aims  in  life  or 
physical  prowess,  and  it  should  be  in  the  hands  of  experts 
whose  services  are  inferior  to  none.  It  is  necessary  that 
vocational  guidance  play  a  part  in  the  placement  of  men. 
It  is  absolutely  essential  that  technical  training  be  sup- 
plemented by  instruction  in  the  arts  and  sciences,  natural 
or  social,  and  there  is  hardly  any  doubt  but  that  education 
up  to  the  twenty-first  year  should  form  our  minimum  of 
demands,  if  democracy  is  to  be  more  than  a  name. 

With  this  right  and  duty  to  learn  should  be  coupled  the 
right  and  duty  to  work,  after  schooling  and  practicum 
has  duly  prepared  men  for  their  career.  Production  at 
most  points  is  a  profession  as  truly  as  if  it  were  based  on 


A  PETITION  255 

the  Liberal  Arts.  To  work  well  is  a  duty  none  can  shirk, 
but  the  chance  to  work  well  must  form  part  of  the  con- 
tract. All  should  be  obliged  to  toil.  Idleness  is  never  a 
gain,  but  may  often  turn  out  to  be  a  vice.  Idleness  is 
consumption  without  production.  Leisure  is  consumption 
with  a  view  to  increased  production.  Leisure  is  more  than 
that,  but  so  much  at  least  it  means  which  the  life  of  a 
wastrel  does  not  mean.  There  is  no  excuse  for  loitering 
and  lolling  about  in  these  days  of  opportunity.  The 
masses  should  not  be  expected  to  work  at  a  treadmill  so 
a  few  may  lead  a  parasitic  existence.  Parasites  are  not 
necessary  in  a  well-ordered  community.  But  on  the  other 
hand,  those  who  have  done  their  share  should  be  allowed 
,VK  to  rest  in  old  age.  Leisure  for  rest,  for  recreation,  and 
for  regeneration  of  productive  powers.  Leisure  for 
amusement  and  sport.  Leisure  for  the  young,  and  re- 
cuperation for  the  aged  when  their  strength  is  on  the 
wane!  N 

These  and  some  other  rights  to  be  claimed  on  behalf  of 
the  common  folk  make  up  the  platform  of  democracy. 
Socialists  have  long  adopted  it,  and  friends  of  progress 
in  all  walks  of  life  will  call  it  their  own.  Democracy 
should  profit  by  social  science,  not  ignore  it  in  the  fatuous 
belief  that  because  its  values  are  not  measurable  by  phys- 
ical standards  they  do  not  exist.  The  values  of  life  and 
of  sociation  are  patent  enough  to  those  taking  the  trouble 
to  study  them.  They  form  part  of  the  equipment  without 
which  men  in  charge  of  public  affairs  are  sure  to  fail. 
Socialists  have  understood  them  in  large  measure,  but 
must  now  agree  to  further  amendments  of  their  original 
creed,  if  they  wish  to  enlist  the  sympathies  of  thinking 
people.  Revision  is  wholesome  according  to  their  own 
teachings.  Revision  is  a  step  in  the  onward  march  of 


256  THE  LIMITS  OF  SOCIALISM 

civilization.  Science  itself  is  nothing  if  not  continual 
growth  and  redefinition  of  terms,  whose  finest  fruit  is  the 
advancement  of  humanism. 

It  is  therefore  no  disgrace  for  socialism  to  have  fallen 
short  of  its  mark,  but  it  would  be  sad  if  the  lessons  it 
first  taught  so  brilliantly  were  to  be  forgotten  by  re- 
formers to  come. 


INDEX 


Achievement  versus  happiness, 
210 

Age,  distribution  in  different 
countries,  132-34 

Alternative  costs,  41 

Art,  versus  the  social  good,  104 

Association,  a  factor  in  reason- 
ing, 66  ff. 

Averages,  as  price  determinants, 
20;  40 

Capital,  according  to  Marx,  21,  23 
capital  goods  as  ideas,  29-31 
paradox  of  wealth,  42-2 
compared     with     consumables, 

12S-29 
Causality   a   question   in  history, 

59,  89  ff 

based  on  correlation,  60  ff 
Causation  an  act  of  imputation, 

84-88 
Christianity      and      competition, 

120-21 

Climate,  effect  on  social  life,  95 
Communist  manifesto,  211 
Compact,      originating      govern- 
ment, 212-13 
Competition      and      Christianity, 

120 

fair  competition,  122 
and  efficiency,  173-77 
Conditions,     and    social    institu- 
tions or  ideas,  91-2 
Conflict,  a  part  of  social  process, 

94 

Consumption,  denned,  191 
a  part  of  environment,  192 
and  happiness,  206  ff 
Correlation  a  basis  in  reasoning, 

60ff 
Cosmopolitanism    and    socialism, 

230 

Cost,  Marxian  notion,  20-1 
marginal  idea,  35-6 


257 


Cost,  socialistic  costs,  184-86 

Democracy,    upheld    by    empiri- 
cists, 214 
premises  of,  218 
and  government  functions,  227 
and  war,  234 

and  economic  reform,  254  ff 
Dialectics,  Hegelian,  49-51 
Differentiation,  111 

a  principle  in  progress,  114 
Diminishing    returns    in    the   fu- 
ture, 156-58 
Distribution,  Ricardian  view,  17- 

18 

Marxian  view,  20,  22-24 
marginal  view,  37-8 
to-day    of    incomes    in    U.    S., 

146-48 

and  invention,  164 
causes  of  unequal  incomes,  166 
unequal     and     productiveness, 

171 

and  taxation,  178 
under  socialism,  186  ff 

Economic   interpretation  of  his- 
tory, 53-56 
restated,  106-07 
Education,  limits  of,  203-04 

and  democracy,  219 
Efficiency     due     to     competition, 

173-77 

versus  income,  202-04 
Employment,  possible  savings  in, 

138 

changes  under  socialism,  152 
Engels,  and  the  socialist  theory, 

49-55 

Environment,  denned,  90;  99 
effect    on    human    nature,    192; 

195 

Ethics,  and  economic  interpreta- 
tion of  history,  102-06 


258 


INDEX 


Eugenics,  199-200 

Evils  now  existing,  249  ff 

Factors,  in  germ-cell,  195 

and  variation,  197 
Feuerbach,  L.,  and  Marx,  51 

Government,       as       professional 

group,  216-17 
by  minority,  222  ff 

Habituation  and  memory,  62-64 
Happiness  and  salvation,  102-03 
Hedonism,  defects  of,  207 
Hegel,    influence    on    Marx,    46. 

49  ff 

Heredity,  and  germ-cell,  194  ff 
Historical    school    of    economics, 

33-4, 
Human  nature,  is  constant,  197- 

98 

types  of,  220 
and  peace,  235-36 

Idealism  in  political  philosophv, 

213-14 

Ideas  versus  conditions,  91-92 
Income,  national,  127-29 
sources  of,  130 

how  to  be  raised  under  social- 
ism, 134 
present  distribution  in  the  U. 

S.,  146-48 

not  all  available  for  consump- 
tion, 163 

why   so  unequal,  166 
determines  pricing,  170 
is  a  price,  180 
as  part  of  enviroment,  192 
and  efficiency,  202 
and  happiness,  206  ff. 
Induction,  principles  of,  68  ff. 
why  making  agreements  possi- 
ble, 77 
Intelligence,     versus     knowledge, 

-^04* 

Internationalism,  226  ff. 
Invention,  30-31 


Justice,  presupposes  reason,  116- 

17 

aims  at  social  strength,  118 
and  competition,  120  ff. 
and  government,  226 
under  socialism,  255 

Labor  power,  gain  under  social- 
ism, 140 

use  of,  in  U.  S.  to-day,  152-55 
Labor  theory   of  value,  20 

criticized,  28-9 
Lamarckianism,   192-93 

bearing  on  economics,  201 

attitude    of    biologists    to-day, 

Leisure,  how  to  use  it,  205 
its  role  in  progress,  255 

Luxuries,  in  the  U.  S.,  149 
as  personal  services,  152-54 

Maladjustment,   93 

how  brought  about,  96-100 
Malthusianism,  22 
Marginism    (see    also    Table    1), 

§3-40 

attitude  toward  Historical  eco- 
nomics, 34 
premises,  35 

notion  of  cost  and  price,  35-6 
on  distribution,  37-8 
criticism   of,  39  ff. 
Marx  (see  also  Table  1),  his  in- 
dependence of  thought,  12-3 
and  Ricardo,  14-5 
and  W.  Thompson,  19 
his  labor-theory,  20-1;  23 
on  private  property,  21-2 
as   Malthusianist,  22 
notion  of  profit-rate,  24 
stand  on  free-trade,  25 
criticism  of  Marx,  28-33 
roots  of  his  philosophy,  45;  54 
Materialism,  and  Marx,  47-49 
Mill,  J.  S.,  his  Logic,  33 
Morgan,    Th.    H.,    on    Lamarck, 

194  ff. 

Motives  versus  deeds,  119 
Mutation,      versus      fluctuations, 
198-99 


Justice,  and  inequalities,  111-14          Nation,  a  unit  of  force,  208 


INDEX 


259 


Nationalism  as  unit  of  social  life, 
235 

(Percepts,      physiological      basis, 

61-4 

defined,  75 
Platform,  of  socialism  in  the  U. 

S.  to-day,  5-6 

Political  philosophy  and  empiri- 
cism, 213-14 

Price,   Marxian  notion,  20-1 
marginal  notion,  35-6 
governed  by  income,  170 
under  socialism,  179  ff. 
Private   property, 

Marx's  justification  of,  21 
and   efficiency,  173-77 
Probability      and      enumeration, 

73-4 
Productivity,       marginal       view, 

36-7 

Proof,  78 

Proportionality  of  factors,  37 
Prosperity,    theory    of    questions 

raised  by  it,  8-9 
stated  fully,  102  ff. 
Production,   socialist  promise  of 

increase,  126-27;  131 
probable  actual  increase,  134  ff. 
how    affected    by    distribution, 
171=72 


Recall,    and    inference,    68  ff. 

Recomposition  of  national  in- 
come, 146  ff. 

Religion,  social  basis  of,  121 

Ricardo  (see  also  Table  1),  main 
points  of  doctrine,  17 

Right  versus  might,  123-24 

Savings,   contrasted   with   inven- 
tion, 31-2 
under  socialism,  143-55 


Science  (see  also  Correlation  and 

Causation) 
growth  of,  80-82 
Smith,   A.,  notion  of  individual- 
ism, 16 

on  equality  of  men,  187 
Socialism,  platform  in  U.  S.  to- 
day, 5-6 

questions  raised  by,  7-8 
plan  for  raising  social  income, 

131;  134  ff. 

and  leisure,  139;  205 
and  changes  in  employment  of 

labor  forces,  150  ff. 
and   competition,   175-77 
and  cost  of  production,  184-85 
and  improvement  of  human  na- 
ture, 194  ff. 
and  eugenics,  199  ff. 
and  cosmopolitanism,  230 
its  merits  and  defects,  244-49 
principle  of  distribution,   186- 

87 

Sovereignty,  212;  228 
Suffering,   a  problem  in  justice, 

Taxation,  and  distributive  justice, 

177 
limits   of  under  individualism, 

178 

Utility,  marginal  view,  36 
Valuation,  wrong  to-day,  251 

how  to  correct  it,  254 
Variation,  biological  view,  195  ff. 

and  sex,  197 

and  mutation,  199 

War,  causes  of,  231-34 

Waste,  avoidance  under  socialism, 

143-55 

Wealth,  and  progress,  104-06 
and  war,  233 


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